Buterin Slammed Ripple’s Defense Against The SEC Lawsuit

Buterin slammed Ripple’s defense against the SEC lawsuit while the rest of the community says that this hit on Ripple is a hit on the entire community and crypto space. As reported earlier today in our ripple news, CEO of Ripple  Brad Garlinghouse announced that the Securities and Exchange Commission will most likely file a lawsuit against his company because of unregistered securities.

Under the US security law, companies have to register with the SEC before selling securities which is a move that Ripple didn’t comply with. Garlinghouse called it an attack on the entire crypto industry and not just Ripple. He said that the action is inconsistent with the stance of other G20 nations and mentioned that their positions Is harmful to the US:

 “The SEC – out of step with other G20 countries & the rest of the US govt – should not be able to cherry-pick what innovation looks like (especially when their decision directly benefits China). Make no mistake, we are ready to fight and win – this battle is just beginning.“

Looks like the Ripple/XRP team is sinking to new levels of strangeness. They're claiming that their shitcoin should not be called a security for *public policy reasons*, namely because Bitcoin and Ethereum are "Chinese-controlled". 😂😂https://t.co/ts02JqrTrB pic.twitter.com/mKwEzGIetk

— vitalik.eth (@VitalikButerin) December 22, 2020

Back in 2018, ex-chairman Jay Clayton declared that BTC and ETH are not securities but said that a security is an investment of money in a common enterprise in which the investors expect the profits to come from efforts of others. The effort of others means that a central third party whose efforts are a critical factor in the enterprise. Clayton added:

“when I look at Bitcoin today, I do not see a central third party whose efforts are a key determining factor in the enterprise. The network on which Bitcoin functions is operational and appears to have been decentralized for some time, perhaps from inception.

And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”

Let's be decentralized, but not divided. Let's help each other to grow the industry. #BTC, #ETH, #XRP, #BNB https://t.co/2jQZ48a12x

— CZ Binance (@cz_binance) December 22, 2020

However, Buterin slammed Ripple’s defense and said that the company is clutching at straws because their arguments hold “no weight when it comes to Ripple’s relationship with XRP.” Buterin’s response drew a lot of criticism from people including Binance’s CEO Changpeng Zhao who echoed that this issue stunts the entire crypto industry. XRP dropped in price after the news and it broke the key support at $0.53.

Alex Saunders commented:

 “I feel for $XRP investors who are hurting right now. I’ve outlined many times why things were never going to end well for@ripple. Hopefully that helped a few of you dodge this bullet. No compliant company will touch #XRP with this over their head.”