Brad Garlinghouse, CEO of Ripple, has voiced criticism of considering Caroline Stebbins for the next Chair of the U.S. Securities and Exchange Commission (SEC), warning that this could seriously harm the crypto industry.
Brad Garlinghouse – CEO of Ripple
In a post on social media platform X on Monday, Garlinghouse stated:
"Among a group of outstanding candidates for the SEC Chair position, considering someone directly involved in the unethical (and potentially illegal) moves of Hinman in classifying winners and losers in the crypto industry is unacceptable. Choosing Stebbins would be like taking us back to the early days of regulation by enforcement."
This criticism comes in the context of expectations that current SEC Chairman, Gary Gensler, will resign after Thanksgiving, with reports suggesting he may leave his position in early January, before President-elect Donald Trump takes office. Trump has pledged to fire Gensler immediately, raising much speculation about who will take over the SEC in the future.
Potential candidates for the SEC Chair position include Paul Atkins, Dan Gallagher, Brad Bondi, and Bob Stebbins. While Atkins and Gallagher are seen as friendly to the crypto industry, Stebbins faces strong opposition from crypto advocates due to her involvement in controversial enforcement actions, including the ongoing Ripple lawsuit. John Reed Stark, former SEC Internet Enforcement Director, has warned about the risks under the leadership of some candidates. Meanwhile, crypto supporters hope that the new leadership will implement clear and less punitive regulatory policies. SEC Commissioner Hester Peirce is said to be uninterested in the position, while SEC Commissioner Mark T. Uyeda has also emerged as a potential candidate.
William Hinman, former Director of the SEC's Corporate Finance Division, where he served from 2017 to 2020. Critics have accused him of favoring certain cryptocurrencies in the industry, due to his 2018 speech in which he stated that Ether (ETH) is not a security, while not providing similar clarity for other crypto assets like XRP.
Ripple has been sued by the SEC since 2020, accused of selling XRP tokens as unregistered securities. In 2023, a judge issued a partially favorable ruling for Ripple. The SEC has appealed some parts of this ruling, keeping the lawsuit ongoing and its outcome significantly impactful for the future of crypto regulation.
However, Garlinghouse believes that the crypto industry in the US will enter a transformative era, thanks to the easing of regulatory oversight under the administration of President-elect Donald Trump. He describes Trump as a 'president of cryptocurrency', who supports innovation and entrepreneurial spirit, which will mark the end of restrictive actions from the SEC. Confident in the future of the industry, Garlinghouse calls for an end to regulatory management by punitive measures.