Ripple General Counsel Stuart Alderoty, recently acknowledged the former United States Securities and Exchange Commission (SEC) Chairman, Late Harvey Pitt, in a tweet expressing gratitude towards his contribution.  

He added that Ripple owes a debt of gratitude to Harvey for providing a comprehensive description employed by the SEC to enforce compliance with securities laws.

Alderoty further cites Pitt’s argument in the Tetragon vs. Ripple case, stating it is the court’s responsibility, not the commission’s, to decide if an asset qualifies as a security.

Alderoty Highlights Pitt’s Report on SEC Lawsuit Process

In the tweet, Alderoty added Pitt’s report in the Tetragon Fin. Grp. vs. Ripple lawsuit as an attachment. The Ripple general counsel drew attention to a comment Pitt made regarding the process of an enforcement action conducted by the SEC.

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Pitt’s report states an enforcement action begins when the SEC files a lawsuit against an entity in a federal court. He also noted that commissioners that vote to bring an enforcement action are minimally involved once the litigation commences.

The former chairman clarified that once the SEC initiates legal proceedings, the commission’s role shifts to that of an advocate for its stance. Also, he emphasized that the court holds the ultimate authority to determine if the asset in question qualifies as a security.

For context, Pitt died in Washington on May 30, 2023, at 78 years, due to a sudden illness. He became the SEC Chairperson in 2001 but resigned after 18 months due to various corporate scandals, including the notorious Enron scandal.

Notably, Pitt served as the US Securities and Exchange Commission chairman under the reign of President George Bush.

SEC vs. Ripple Legal Battle and Controversy Over Crypto Asset Securities

It is worth noting that the lawsuit filed against Ripple by the SEC has lasted over two years, resulting in Ripple spending about $200 million to fight back.

The SEC accuses Ripple of selling an asset as an unregistered security, while Ripple says the asset should be seen as a digital currency rather than a security.

In addition to XRP, the SEC has recently designated various other crypto assets as securities.  This list includes ADA, CHZ, SOL, AXS, FIL, ICP, FLOW, NEAR, MATIC, VGX, SAND, DASH, BNB, BUSD, ATOM, MANA, ALGO, and COTI.

Following the SEC’s decision to label multiple crypto assets as securities, the commission has encountered several criticisms from the crypto community. SEC Chair Gary Gensler had asserted that most crypto assets, excluding Bitcoin, are considered securities. 

Nevertheless, Gensler did not explain how he reached this conclusion regarding the legal classification of these “most” cryptocurrencies.

Meanwhile, in a recent tweet by Alderoty, he said that despite what Gensler said, the Securities and Exchange Commission does not have a magic regulatory wand to convert any token to securities. He added that he’s looking forward to how the Congress and Courts will follow up the case.

Featured image from Pixabay and chart from Tradingview.com