Recent revelations surrounding the Securities and Exchange Commission (SEC) have shed light on potential conflicts of interest in its cryptocurrency enforcement. Twitter user Digitalassetinvestor.xrp has sparked discussions by analyzing documents obtained from the SEC through Empower Oversight. These findings have raised provocative questions about the fairness and transparency of the SEC’s decisions in the crypto space.
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Empower Oversight Makes Way for Conflict
Empower Oversight, through a persistent two-year Freedom of Information Act (FOIA) lawsuit, has obtained a series of revealing documents from the Securities and Exchange Commission (SEC). Empower Oversight unveiled the influential role of Consensys founder, Joseph Lubin, in shaping the views of former SEC Director of Corporation Finance, William Hinman.
The bombshell information, which details Lubin’s significant input into Hinman’s pivotal 2018 speech classifying Ether as a non-security, also hints at potential misconduct. Allegedly, Hinman met with Simpson Thacher’s partner, Chris Lin, while he was representing a crypto sector client – a move that contradicts SEC Ethics Office advice and raises questions considering Hinman’s lucrative financial ties to Simpson Thacher.
This exposé brings to light the integrity of the SEC’s decision-making process in cryptocurrency enforcement.
Read More: Did Ethereum Purchase Free Pass From Hinman? Ripple-SEC Lawsuit Takes a Shocking Twist
Two Sides of the Coin: Ethereum vs. Ripple
In a series of tweets, the Digitalassetinvestor.xrp raises pointed questions about the treatment of Ethereum’s Vitalik Buterin and Joseph Lubin, compared to Ripple’s Brad Garlinghouse.
The user, reviewing the documents obtained from the SEC, questioned why former SEC Director of Corporation Finance, Bill Hinman, appeared to go to great lengths to accommodate Ethereum’s creators, while allegedly giving Ripple’s CEO the proverbial cold shoulder.
This query hints at a potential bias within the SEC that favored Ethereum over Ripple, further deepening the controversy surrounding the organization’s cryptocurrency enforcement decisions.
Favoritism in Ether(eum)?
The allegation suggests that Hinman might have been bending over backward to accommodate Ethereum’s founders, possibly assisting them to ensure Ether was not classified as a security in his controversial 2018 speech.
Read More: Ethereum’s Legal Status in Question After Court Ruling; SEC’s Silence Rings Loud
On the flip side, Ripple was seemingly not afforded the same courtesy. Digitalassetinvestor.xrp pointed out that Hinman, in partnership with former SEC Chairman Jay Clayton, was allegedly giving Brad Garlinghouse, Ripple’s CEO, a difficult time and even came back to the SEC after he left to make sure the lawsuit against Ripple went through.
Understanding the Ripple Lawsuit
Ripple Labs and its top executives have been battling a lawsuit from the SEC since December 2020. The SEC alleges that Ripple’s sale of its native cryptocurrency, XRP, was an unregistered securities offering worth over $1.38 billion. The crux of the argument lies in whether XRP should be classified as a security or not.
If Digitalassetinvestor.xrp’s insinuations hold water, it would imply that the SEC might have played favorites in its enforcement decisions, potentially creating a significant scandal.
The fight for fairness and transparency within cryptocurrency enforcement is far from over, and Empower Oversight shows no signs of backing down.
Read More: SEC’s Double Standards Exposed: Ethereum Favoured, Ripple Snubbed?