The clash between Ripple Labs and the Securities and Exchange Commission (SEC) intensifies, with Ripple’s co-founder, Chris Larsen, delivering harsh criticism of SEC Chair Gary Gensler. In a recent CNBC interview, Larsen called Gensler the "worst public servant of all time", pointing to the failed crypto policies in the U.S. and his backing of Kamala Harris' campaign. Although Larsen voiced disdain for Gensler and FTC Chair Lina Khan, he did not explicitly support efforts to remove Gensler from his position.
.@Ripple Chairman Chris Larsen calls Gary Gensler
The worst public servant in U.S. history 🤣 pic.twitter.com/1jQyG5FbJN
— 𝗕𝗮𝗻𝗸XRP (@BankXRP) October 26, 2024
Ripple and the SEC have been embroiled in a legal battle since late 2020, when Larsen and CEO Brad Garlinghouse were named in an SEC lawsuit. The SEC accused Ripple of selling unregistered securities through its XRP token, claiming that Ripple’s actions violated securities laws. Ripple countered, arguing that XRP should not be classified as a security, using past SEC statements to support its stance. By October 2023, Ripple moved to dismiss the charges, with Garlinghouse accusing the SEC of attempting to damage his reputation.
In July 2023, a judge ruled that while Ripple's token sales to institutional investors did breach securities regulations, its sales to retail customers on exchanges were deemed compliant. Despite this mixed ruling, the SEC quickly filed an appeal, indicating that it would continue its legal pursuit against Ripple’s leadership. In response, Ripple filed a cross-appeal, pledging to fully defend its position.
Gensler's approach to the crypto industry has disappointed many who initially expected a more crypto-friendly environment. Known for his tech expertise and academic background, including teaching a blockchain course at MIT, Gensler was seen as a potential ally. However, he adopted a strict regulatory approach, starting with actions against major exchanges like Binance and Coinbase.
The ongoing legal struggle between Ripple and the SEC has become a focal point within the crypto sector, with Gensler’s policies facing significant backlash. Ripple’s Brad Garlinghouse has criticized Gensler for stifling crypto innovation and blamed the SEC for failing to prevent the FTX collapse. As the battle between Ripple and the SEC continues, the dispute remains a defining issue in the ongoing debate over crypto regulation in the U.S.
