In a pivotal move, renowned attorney and XRP advocate John Deaton has launched a scathing critique against the United States Securities and Exchange Commission’s (SEC’s) legal representatives. XRP advocate Deaton expressed his disapproval following a recent statement by SEC lawyers during the ongoing lawsuit involving Coinbase Global Inc.
While Bitcoin (BTC) is not the primary focus of the litigation, the SEC lawyers drew attention to the coin’s security status in a statement that has stirred controversy. In a notable revelation, the SEC attorneys asserted that Bitcoin (BTC) should not be classified as a security due to the absence of an ecosystem surrounding it.
XRP Advocates Challenge SEC’s Security Criteria
Critiquing this standpoint, esteemed crypto lawyer MetaLawMan highlighted a fundamental flaw in the SEC’s analogy. The SEC contends that a centralized body, a development team, or a DAO (Decentralized Autonomous Organization) is crucial for determining a coin’s security status, as it establishes a common interest responsible for safeguarding investor funds.
However Deaton and MetaLawMan refuted the SEC’s argument, emphasizing the inherent decentralization of cryptosystems and the on-chain operations of specific coins. While acknowledging that many blockchain-based projects have dedicated development teams, these teams typically operate based on the broader interests of the community rather than exerting control over it.
MetaLawMan pointed to Bitcoin’s substantial community support, exemplified by its record-breaking hashrate reaching an All-Time High (ATH) of 500 exahashes. Achieving this milestone underscores the decentralized and autonomous nature of the Bitcoin network, where computers worldwide contribute independently to maintain the network’s integrity.
Despite previous legal battles and discussions on the security status of digital currencies, the SEC persisted in its contentious stance regarding Bitcoin (BTC). The regulatory body faced a significant setback when Judge Analisa Torres ruled in July of the previous year that XRP, the digital asset at the center of a separate lawsuit against Ripple Labs Inc., is not inherently a security.
Rather than adapting its approach based on this precedent, the SEC continued its legal pursuit, targeting prominent cryptocurrency exchanges like Coinbase and Binance. In a controversial move, the regulator classified additional assets, including Cardano (ADA), Solana (SOL), and Polygon (MATIC), as securities.
As the legal battle unfolds with Coinbase, industry analysts are speculating a 70% probability of success for the cryptocurrency exchange. The outcome of this case is anticipated to have broader implications for the crypto industry and the regulatory landscape.