U.S congressman Brad Sherman has questioned the legality of XRP, urging the Securities and Exchange Commission (SEC) to go after exchanges trading the token.
Sherman said he supports the SEC’s case against Ripple and has always backed the commission’s enforcement division drill session. However, he disclosed his resentment regarding the SEC’s failure to tackle exchanges that had traded XRP.
Sherman Urges SEC To Go After Exchanges That Traded XRP
The division’s director, Gurbir Grewal, also attended the session. The discussion was based on the main role of the SEC in crypto. According to Sherman, the SEC’s enforcement decision must step up its regulatory position to play its role effectively.
Sherman added that the division has resolved that XRP is a security and will go after it, but has not yet gone after the exchanges. He noted that tens of thousands of illegal security transactions surrounding the token have occurred, but the SEC is still not doing anything to tackle exchanges about it.
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He reiterated that all parties involved in the case already know that XRP is a security, which means that the exchanges have been operating an illegal securities exchange. Sherman has asked the division to pay attention to the issue.
General counsel at Ripple, Stuart Alderoty, countered Sherman’s claims, saying that such claims are false because the court has not yet ruled on the matter.
He added that the situation negatively impacts SEC’s enforcement approach, harming innovation and discouraging businesses. The allegations are unproven, and Alderoty has vowed that Ripple will stand to defend itself.
Sherman Called On The Ban Of Crypto In 2018
Sherman is one of the major critics of cryptocurrencies, who called on the government in 2018 to completely face the industry. Since SEC started the case with Ripple, the major U.S cryptocurrencies, including Coinbase, placed a trading suspension on the XRP token.
SEC Chair Gary Gensler has proposed that all cryptocurrency exchanges should be registered as securities exchanges with the commission. But it has not been implemented yet.
SEC filed a high-profile lawsuit against Ripple in 2020, alleging that the company’s token XRP is unregistered security. The case has been dragging on since then as Ripple has been putting on a strong defense against the case. The court has not yet determined the regulatory status of the token, but the case could be concluded next year.
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