In the midst of the company's continuing battle with the SEC, Garlinghouse decided which regulatory agency is ideal for the cryptocurrency sector.
Following the debate over which regulatory agency, the CFTC or the SEC, should govern cryptocurrencies, Brad Garlinghouse, the CEO and founder of Ripple, has expressed his thoughts on the subject.
In a recent Bloomberg interview, Garlinghouse stated that the Commodity Futures and Trading Commission is the most appropriate regulator for the digital currency market.
“Time and Time again, what you find is that the CFTC is the most appropriate regulator for this industry and I think you will find that uniformity across the whole industry,” the Ripple founder was quoted as stating in the interview.
The SEC vs. Ripple Lawsuit: A Factor in Garlinghouse's Decision?
Garlinghouse may choose the CFTC over the Securities and Exchange Commission because of the SEC's case against Ripple.
The SEC previously charged Ripple and two of its officials, including Garlinghouse and the company's chairman Chris Larsen, with conducting an unregistered securities offering in 2013, in which the company raised $1.3 billion.
While the SEC is convinced that Ripple's XRP is a security, the blockchain company is adamant that it is not, and it intends to prove this in court.
The United States is the only country that views XRP as a security.
In the interview, Garlinghouse stated that the SEC of the United States is the only regulator in the world that considers XRP to be a security, since other worldwide authorities have classified the digital asset under alternative terminology.
“The only country on the planet that thinks XRP is a security is the United States.”
Because no other country has joined the SEC in classifying XRP as a security, the US agency is said to have used various tactics to force Ripple to agree to a settlement that will end the action.
The SEC's Delay Techniques
The SEC has been accused of using delay tactics to stall the lawsuit's decision after the allegations were published in December 2020.
Due to the delays, the case has been postponed until next year, with a decision likely before the end of 2023.
While there is no certainty as to which party would be favored, several analysts believe Ripple will prevail in the litigation.
Ripple is acting as if it has already lost.
Meanwhile, Garlinghouse is careful not to get his hopes up, stating that the corporation is already acting as if the case has been lost.
If Ripple loses, the blockchain startup will be unable to function in the United States and will have to rely on its clients in other nations to succeed.
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are looking for ways to regulate cryptocurrency.
Both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have been fighting for the task of overseeing the regulation of the digital currency market for years.
Both the CFTC and the SEC have weighed in on concerns affecting the embryonic market, making regulatory decisions.
For example, the CFTC determined Bitcoin, the world's largest cryptocurrency by market capitalization, to be a commodity, and thus the asset class falls within its control, based on its utility.
Similarly, the Securities and Exchange Commission (SEC), through its previous director William Hinman, determined that Ethereum is not a security and does not fall under the agency's regulatory scope.
Meanwhile, Garlinghouse is wary of getting his hopes up, claiming that the corporation is already acting as if the case is lost.
If Ripple loses, it will be unable to operate in the United States and will have to rely on its clients in other countries to survive.
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are both looking at regulating cryptocurrencies.
For years, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have fought for control of the digital currency market's regulation.