XRP holders’ lawyer, John Deaton, has proposed a distinctive approach for crypto firms dealing with the U.S. SEC. Recently, he responded to Ripple CTO David Schwartz’s X post on handling the SEC; Deaton suggested a fourth option: firms should refrain from cooperating with or talking to anyone at the SEC.
He emphasized that businesses should redirect any inquiries from the SEC to their attorneys, and if served with a subpoena, they should contact their lawyer before taking action.
Firms Can win over the SEC if they have…
Giving a broader overview: He said this perception that the SEC has been partial toward many firms in the cryptocurrency industry, even those seeking regulatory clarity. Two notable cases are Ripple Labs Inc. and Coinbase Global Inc. Ripple has repeatedly sought guidance from the SEC regarding the classification of its XRP coin.
Still, the commission filed a lawsuit against the company instead of providing clear rules. Similarly, Coinbase faced a similar situation and subsequently filed a counter-suit against the SEC for failing to deliver the necessary regulatory clarity in the U.S. He is clear that fighting with the SEC is the only way to stand against the odds.
Coinbase has a bigger chance to win if they stand by their decision like Ripple. In other cases, like ETH, he is sure that the SEC has manipulated rules to favor ETH initially over XRP.
How Crypto Reacted to Deaton’s Claims?
While objecting to Deaton’s narrative, Nerayoff asks if lawyers and government agencies collude and suggests hiring the agency’s lawyer, mainly referencing less trusted institutions than the US SEC. In response to the statement, Deaton alleges a strategic move by ConsenSys, who hired Jay Clayton’s law firm to represent them to influence his actions as SEC Chair.
However, despite his ties to the law firm, Clayton voted for enforcement actions against ConsenSys’ competition, which some view as a violation. After leaving the SEC, it also raises questions about Clayton’s involvement in specific meetings and job choices.
Deaton’s advice has always helped naive investors, and in the current scenario, crypto needs a clear and constructive bridge between regulatory bodies and crypto firms. It also reflects the cautious stance many in the crypto industry are taking towards the SEC, seeking to protect their interests while navigating the regulatory landscape.
