Ripple's Chief Legal Officer (CLO) Stuart Alderoty has voiced strong concerns over the U.S. Federal Reserve and Securities and Exchange Commission (SEC) for scapegoating cryptocurrency in money laundering accusations. Alderoty argued that money laundering is a broader issue within the traditional financial system, with even institutions like the New York Federal Reserve involved in facilitating illicit transfers.
Money Laundering: A Broader Financial System Issue
On September 10, Stuart Alderoty took to X (formerly Twitter) to challenge the narrative that money laundering is primarily a crypto problem. He cited a report from The Wall Street Journal revealing that the New York Federal Reserve had failed to prevent illicit money transfers, which were used to finance terrorist groups in Iran for years.
"Some say money laundering is a crypto problem. Not true. Just ask the NY Federal Reserve, which let hundreds of millions of dollars slip through," Alderoty wrote.
Alderoty criticized the U.S. Federal Reserve and SEC for unfairly blaming the cryptocurrency industry for money laundering while ignoring similar issues within traditional finance. He joins other crypto advocates, including pro-XRP lawyer John Deaton and former White House Communications Director Anthony Scaramucci, in criticizing figures like Senator Elizabeth Warren and SEC Chair Gary Gensler for their anti-crypto stance.
Alderotyâs remarks also align with ongoing frustration from crypto executives, who have condemned efforts to sever ties between Wall Street and the crypto industry, particularly during the so-called "Operation Choke Point 2.0," where regulators were accused of scapegoating crypto for bank failures last year.
XRP Community and John Deaton Support Ripple CLO
John Deaton, a GOP Senate candidate from Massachusetts and a prominent pro-XRP lawyer, shared data supporting Alderoty's stance, highlighting that Bitcoin and crypto are used far less for illicit transactions compared to traditional financial institutions. Deaton also pointed out that major banks such as HSBC, JPMorgan, Bank of America, and Wells Fargo have been implicated in money laundering schemes, which dwarf any issues within the crypto space.
The United Nations Office on Drugs and Crime estimates that between $800 billion and $2 trillion is laundered annually through global financial systemsâmuch of it facilitated by traditional banking institutions, not cryptocurrencies.
Ripple CEO Brad Garlinghouse also echoed these sentiments, criticizing the U.S. government's hostile stance toward the crypto industry, which has been marked by enforcement-driven regulation from the SEC rather than proactive regulatory frameworks seen in other countries.
XRP Price Jumps Amid Legal and Market Developments
XRP saw a nearly 3% price increase in the last 24 hours, trading at around $0.539. Its 24-hour low and high were recorded at $0.528 and $0.542, respectively. The trading volume has surged by 40%, indicating renewed interest from traders.
Despite this uptick, analysts remain cautious about any sudden, significant price jumps. A recent analysis by CoinGape pointed out that XRPâs price may not see a sharp rally, even with Rippleâs recent legal victories and developments in the XRP Ledger, due to broader market conditions and regulatory uncertainty.
In summary, while Rippleâs CLO and the broader XRP community continue to push back against the scapegoating of crypto for money laundering, the market remains cautious as the U.S. regulatory environment shows little sign of easing.
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