Attorney John Deaton, a vocal advocate for XRP, has shed light on the potential unfair play by former U.S. Securities and Exchange Commission (SEC) executives during the lawsuit against Ripple Labs Inc. Deaton’s claims revolve around an intricate web of connections involving former SEC Chairman Jay Clayton, top enforcer William Hinman, and Ethereum co-founder Joseph Lubin.
Deaton took to Twitter to share his findings, suggesting that Clayton’s appointment led to a chain of events benefiting his law firm, Sullivan & Cromwell (S&C), and Lubin’s ConsenSys. Clayton’s association with S&C prompted Lubin to hire the firm, ensuring Clayton’s recusal from any enforcement action involving his firm’s clients. This maneuver, as per Deaton, seemingly manipulated the voting process.
Hinman’s involvement adds another layer of intrigue. Clayton apparently recommended Hinman reach out to Lubin, implying a coordinated effort to support ConsenSys. Deaton’s revelations claim that Clayton’s inquisitiveness about Lubin’s meetings, particularly those involving ConsenSys, hints at potential manipulation.
Deaton further accuses Hinman of ethical misconduct, asserting that Hinman disregarded warnings from the SEC Ethics office and improperly declared Bitcoin and Ethereum as non-securities. Hinman’s alleged profiting from his law firm’s success after giving the speech raises concerns about potential conflicts of interest.
Clayton’s Post-SEC Employment & Ripple Lawsuit Outcome
The attorney’s claims extend to Clayton’s post-SEC employment with One River, a firm that had significant stakes in Bitcoin and Ethereum. Clayton’s subsequent vote for an enforcement action against Ripple, a competitor of his former client, has raised eyebrows.
Notably, Deaton points out the disparity in legal representation choices. If Ripple’s Brad Garlinghouse and Stuart Alderoty had engaged S&C, the outcome might have differed. Deaton’s exposé prompts a broader debate on the ethical boundaries of legal and regulatory actions, emphasizing the potential ramifications of such interconnected interests.
While Deaton’s allegations have yet to be officially substantiated, they raise pertinent questions about transparency, ethics, and potential conflicts of interest within regulatory bodies. However, the crypto industry is currently navigating complex legal terrain. In light of recent revelations, it becomes necessary to closely examine the relationships and decisions that influence major cryptocurrency lawsuits.