There are always new twists and turns in the SEC’s lawsuit against Ripple Labs. One aspect that keeps resurfacing concerns comments made by the SEC’s former Director of Corporation Finance William Hinman.
In a 2018 speech, Hinman had opined that Ether is not a security. While Ripple has continued to use this point to reiterate that XRP would also fall in the same category, the SEC, for its part, has now changed its position on the same.
Nevertheless, it can’t be denied that the speech was considered by many to be the SEC’s official position. Its u-turns since have left the industry dizzy.
During a recent AMA, Cardano founder Charles Hoskinson also shared a similar opinion, with the exec saying that this flip-flopping has fueled more ambiguity than ever before. Arguing that it is unfair on the industry for regulators to keep changing their stance, Hoskinson said,
“If it’s a personal opinion, you issue a statement after the fact, but you can’t just let it ride, let opinions be written out and have the industry push forward, and then change your mind because it’s convenient for a particular enforcement case you’re doing.”
Hoskinson further noted that making such moves on “political convenience” creates a lot of confusion that a $2 trillion industry doesn’t deserve. He added,
“It’s just hurtful to everybody and it’s not a partisan thing, it’s just a clarity thing. When you’re in an industry you would want to know what the rules are, but if the rules are ever-changing and indiscernible, or are staged in a way that is impossible to comply, so you regulate it out of existence.”
However, the crypto-exec didn’t place the whole onus for the situation on regulatory bodies such as the SEC or even the CFTC. Especially since they are following the playbook provided by legislations which have been unsatisfactory to most.
While a much-publicized Congressional hearing for top executives of cryptocurrency companies in the U.S did take place last December, the country is yet to pass any laws regarding the regulation of this asset class. In turn, the SEC has asked the digital asset industry to follow securities rules already laid out for traditional finance. According to many, this may not always be the best approach.
Nevertheless, President Joe Biden is expected to issue an executive order in relation to oversight as early as this week. This would reportedly be aimed at directing various agencies to study the asset class and its industry before coming up with a government-wide strategy to regulate digital assets.
