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XRP holders' attorney John Deaton underscores the SEC's breach of allegiance in light of recent comments made by Former SEC Chairman Jay Clayton, who is behind the ongoing Ripple case.
In a recent interview with CNBC, former SEC Chairman Jay Clayton criticized SEC Chair Gary Gensler's regulatory approach. Clayton recalls Gensler as saying, "If we're not losing cases, we're not suing enough businesses." Cameron Winklevoss, co-founder of the Gemini Exchange, branded it a "total abuse of power."
This is exactly what the Judge in the @Ripple case was alluding to when she said SEC lawyers were not maintaining a faithful allegiance to the law. You’re supposed to have a good faith basis to being a case, meaning you believe you can win by applying the law. You don’t wait… https://t.co/l8IeBkL3Iu
— John E Deaton (@JohnEDeaton1) June 28, 2023
Clayton went on to say that the regulator should only file cases that it believes will pass judicial muster.
In response to the former SEC chair's statements, Deaton referred to the judge's comments in the Ripple lawsuit, which stated that SEC lawyers were not maintaining faithful allegiance to the law.
"You're supposed to have a good faith basis to bring a case, meaning you believe you can win by applying the law," Deaton continued. "You don't wait until a judge tells you otherwise."
The United States Securities and Exchange Commission (SEC) filed lawsuits against the two largest cryptocurrency exchanges, Coinbase and Binance, in the first week of June.
As reported by U.Today, shortly after the lawsuits were filed, Jay Clayton publicly condemned the behavior of cryptocurrency exchanges, mentioning the need for them to adhere to existing securities laws.
Judge points out SEC's lack of faithful allegiance
As earlier stated, Deaton stated that a federal judge literally stated in a written order that SEC lawyers were hypocrites and lacked faithful allegiance to the law. Deaton claims that in another case, also in the Ripple case, the judge stated that SEC lawyers were more concerned with furthering their agenda than with following the law.
The past week saw the public release of the LBRY status conference, which was held in February. A portion of the transcript highlighted the judge's stance on the lack of clarity provided to crypto investors by the SEC and the agency's refusal to provide such clarity.
The judge expressed his frustration regarding this, saying he cannot force the SEC nor can he provide such clarity.
Arman Shirinyan
Alex Dovbnya
