SEC: XRP holders launch a ‘crusade’ against the agency

The U.S. Securities and Exchange Commission (SEC) has moved to oppose XRP token holders’ participation in the Ripple proceedings. In the regulator’s view, third-party intervention would prolong the litigation and require additional resources.

The SEC argues that the petitioners’ actions force it to take coercive action against certain investors on the secondary market. Earlier, the agency deemed their inclusion as defendants in the suit inappropriate.

The regulator also noted that the investors did not offer new substantive arguments. Instead, they paraphrased Ripple’s lawyers’ theses concerning XRP’s legal status, the token’s purported use, and other issues already raised by participants in the case.

According to the SEC, XRP holders have launched a ‘crusade’ against the agency, and their representative, John Deaton, founder of the Deaton Law Firm, is simply trying to make a name for himself.

“Deaton noted that his popularity on Twitter is rising thanks to these efforts. Consequently, he abandoned attempts to obtain a court injunction and began seeking volunteers to join a potential class-action lawsuit against the SEC,” the regulator noted.

According to the regulator’s site, the next closed hearing in the Ripple case will take place on May 6, 2021. The hearing will address issues related to the filing or settlement of lawsuits and administrative actions.

In December 2020, the SEC charged Ripple and its top executives with unregistered sale of securities under the guise of digital tokens totaling $1.3 billion. Later, the agency amended the complaint, focusing on the actions of Brad Garlinghouse and Chris Larsen.

In March 2021, the regulator attempted to block XRP holders’ motion to participate in the proceeding. Later, a court in the Southern District of New York supported the investors.

SEC Memorandum of Law Opposing Motion to Intervene 050321 by ForkLog on Scribd

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