As the resolution of the Ripple-SEC lawsuit nears, Sologenic co-founder Bob Ras has taken to Twitter to share his take on the SEC's approach to crypto regulation.
Ras claims that the crypto industry is already feeling the "ripple effects" of the SEC's aggressive approach to crypto regulation. He adds that the SEC is in a weaker position than it has ever been.
6/7 Recent court developments in the @Ripple case shed light on the SEC's inconsistent stance, revealing that there may be reasonable grounds to conclude that not all crypto-assets satisfy the criteria to be classified as securities. This also has implications for other…— Bob Ras (@bobrasX) May 23, 2023
The agency's attempt to designate practically all digital assets as securities, according to Ras, shows a lack of knowledge about the unique nature of these new technologies. Companies like Ripple are facing unnecessary legal battles due to this oversight.
He continued by saying that the SEC has effectively shot itself in the foot owing to the pursuit of crypto projects — many without reasonable grounds.
This would be seen as stifling innovation and might cause a significant number of projects to go offshore. The Sologenic co-founder notes that companies like Ripple must contend with this adverse environment.
Ras compares the SEC's approach to that of an old-school lawmaker trying to apply outdated laws to a technology it does not fully comprehend.
He emphasizes the reality that crypto assets are a new asset class, so treating them simply as securities would mean overlooking their unique qualities and potential. Ras believes that the smart move for the SEC would have been to create a regulatory framework that considers the nature of these assets.
SEC's inconsistencies highlighted
The co-founder of Sologenic draws attention to the fact that recent developments in the Ripple case have exposed the SEC's contradictory position and shown that there may be a good reason to believe that not all crypto assets meet the requirements to be categorized as securities.
Ras said that this has implications for other businesses, like Coinbase.
He urges the SEC to abandon its enforcement-based approach to regulation. Ras argues that it is time to embrace a regulatory framework that promotes innovation while safeguarding investors.
He continued, "If the SEC continues its current approach, it risks further damaging its reputation and the US's position in the global crypto market."