NAIROBI (CoinChapter.com)— Attorney John Deaton has raised new concerns over the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Ripple Labs, revealing what he claims are conflicts of interest and hidden alliances that have harmed Ripple and its digital asset, XRP.
XRP Early Gamble: Did They Bet on the Wrong Strategy?
When Ripple introduced XRP in 2012, the cryptocurrency landscape was still in its infancy. Stablecoins didn’t exist, and competition in the global payments industry was scarce. Faced with a strategic decision, Ripple opted to prioritize cross-border payments over exploring smart contracts, drawn by the potential of the untapped payments market.
Ripple faces rivalry from Fireblocks’ initiatives. Source: X
In 2019, Coinbase promoted XRP as a fast and cost-effective tool for global remittances, and MoneyGram adopted XRP for transfers. However, these successes were short-lived. By Dec. 2020, the SEC filed a lawsuit against Ripple, claiming XRP was an unregistered security.
Coinbase Backs Off, MoneyGram Jumps Ship: Was the SEC’s Timing Strategic?
The SEC’s lawsuit led to Coinbase delisting XRP and MoneyGram switching to Stellar (XLM). Deaton has since questioned the SEC’s actions, noting the puzzling regulatory disparity between XRP and XLM, given that both were created by Ripple co-founder Jed McCaleb.
The shifting market dynamics also highlight broader challenges Ripple faces in maintaining its dominance in the cross-border payments sector. As competition intensifies, platforms like Fireblocks—leveraging advanced technologies such as AI agents and tokenization—are expanding their foothold in the industry. Reports indicate that Fireblocks processed $6 trillion in transactions, underscoring the growing competition from emerging blockchain solutions.
Deaton also alleged that individuals supporting the lawsuit later joined Ripple’s competitors, hinting at coordinated efforts to undermine Ripple. “You don’t have to be an XRP fan to see the conflicts of interest here,” Deaton remarked, emphasizing that the SEC’s lawsuit may have broader implications for crypto regulation.
Ripple scored a partial victory on July 13, 2023, when Judge Analisa Torres ruled that XRP is not a security in most cases. However, the SEC appealed on Oct. 17, challenging parts of the ruling. The next critical date is Jan. 15, 2025, when the SEC must file its opening brief for the appeal.
