all about cryptop referances
US Congressman Brad Sherman has urged the US Securities and Exchange Commission (SEC) to go after major cryptocurrency exchanges that traded xrp, which the regulator considers a value. “It’s easier to go after the small fish than the big fish, but the big fish who run big exchanges did many, many tens of thousands of transactions with xrp,” the lawmaker said.
Congressman Brad Sherman (D-CA), chairman of the House Financial Services Subcommittee on Investor Protection, held a hearing Wednesday to examine the efforts of the US Securities and Exchange Commission (SEC) to address emerging risks and to protect investors.
During the hearing, Sherman, who is a senior member of the Foreign Affairs Committee, asked the SEC’s Director of Enforcement Gurbir Grewal about XRP and Tether.
The congressman told Grewal: “You’ve gone after XRP because XRP is a security. But you haven’t gone after all the big crypto exchanges that processed tens of thousands, if not far more, [XRP] transactions.” He emphasized:
If XRP is a security, and you think it is, and I think it is, why aren’t these crypto exchanges against the law?
He continued: “And is it enough that the crypto exchanges have said, ‘well having committed tens of thousands of violations in the past, we promise not to do more in the future.’Is that enough to get you off the hook for enforcement?”
The SEC director responded: “I can’t talk about what case we’re looking at and not looking at. We have brought exchange cases, we took one last year against Poloniex.”
Sherman replied:
It’s easier to go after the small fish than the big fish, but the big fish running big exchanges did many, many tens of thousands of transactions with XRP.
He added: “You know it’s a security. This means that they illegally operated a security centre. They know it’s illegal because they stopped doing it, even though it was profitable. So if they know it’s illegal and you know it’s illegal and I know it’s illegal, I hope you focus on that.”
Turning his attention to the stablecoin tether (USDT), Sherman said: “And then finally we have tether, which is a money market fund in every way.” He noted that the USDT recently “broke the money.”
The congressman from California asked the SEC director:
Can you tell us why you went for terra but not tether?
Grewal replied: “It would be inappropriate for me to comment on who we are and are not going after. But I understand your concerns and we have added resources to our crypto assets unit to look at issues that put investors at risk, including the issues you have raised in your question.”
The SEC is investigating terrausd (UST), the algorithmic stablecoin that collapsed in May along with cryptocurrency terra (LUNA). After the implosion of the two coins, SEC Chairman Gary Gensler warned that many crypto tokens will fail.
In closing, Sherman told Grewal, “You have to take on some cases you’re not sure you’re going to win.”
In December 2020, the SEC accused Ripple Labs and its two top executives – CEO Brad Garlinghouse and co-founder Chris Larsen – of conducting $1.3 billion in XRP, which the regulator said was an “unregistered securities offering”. Following the announcement of the lawsuit, crypto exchanges in the United States began delisting XRP, including the Nasdaq-listed crypto exchange Coinbase.
In response to Sherman’s remarks, many people on Twitter were quick to point out that no country, including the United States, has determined that XRP is a security. Stuart Alderoty, general counsel for Ripple, tweeted on Wednesday:
When elected officials don’t understand that just filing a case by the SEC doesn’t decide anything… it’s beyond worrying… Only the court can make a decision (it’s called due process).
During Wednesday’s hearing, Congressman Tom Emmer (R-MN) also criticized the SEC’s approach to regulating the crypto industry. “It seems clear to everyone, except perhaps those at the commission, that the SEC is not regulating in good faith,” he said.
What do you think of Congressman Brad Sherman’s comments? Let us know in the comments section below.
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