Ripple subpoenas former SEC official; watchdog fights move as it holds key to the case

The SEC has its back on the wall and is out to quash a deposition subpoena served to a former SEC official by Ripple.
There is speculation that the official is former chairman Jay Clayton and from such a deposition, Ripple could crash the SEC.

Ripple has been keen to question Jay Clayton and a number of other top officials in the SEC. In the latest twist in the ongoing legal battle between Ripple and the SEC, the San-Francisco company has subpoenaed a former SEC member. Ripple hopes to question the unnamed official under oath making his revelation critical to the case.

For one, Ripple, which has questioned why the SEC took more than 7 years before declaring XRP a security, believes that the agency only recently changed its view and therefore hopes to get a formal document or statement confirming that XRP was classified the same as Bitcoin and Ethereum up until last year.

Although the two parties are yet to reveal who the member is, many in the community are speculating that it is the former SEC chairman Jay Clayton. The case against Ripple was presented during his last days in office. While still in office, the agency had publicly declared that Bitcoin and Ethereum are not securities. Additionally, just months after leaving the SEC, he joined a Bitcoin and Ethereum focused company.

The SEC has recently warned that there are hundreds of securities masking as cryptocurrencies. There is speculation that the SEC is getting ready to go after Binance Coin (BNB) and Tether (USDT). However, as far as the SEC goes, only Bitcoin and Ethereum are safe. The same is the main reason that Ripple CEO Brad Garlinghouse has stated several times that the attack on XRP is an attack on the entire industry. It could easily set a precedent.

Related: Binance Coin and Tether very likely to be classified as securities, and Ethereum 2.0 isn’t too safe either: Legal expert

Ripple questioning of a former official could break SEC case

Since Ripple filed the subpoena, SEC has gone into defense mode and is quickly looking to squash it. According to a letter shared by James Filan on Twitter, the SEC is raising the issue with Ripple questioning a former official and wants the court to halt proceedings. Since the SEC and Ripple are in disagreement, the decision is in Majistrate Netburn’s hands.

#XRPCommunity #SEC_News v. #Ripple #XRP @stedas SEC announces intention to file, on Thursday, June 24, 2021, a letter motion to quash a deposition subpoena served by Ripple on a former SEC official. Briefing schedule below. pic.twitter.com/F03MVJw1qU

— James K. Filan (@FilanLaw) June 22, 2021

With the company keen to prove that XRP is similar to Ethereum and Bitcoin, it is likely that if the decision goes Ripple’s way, the former official will need to reveal how the agency came to the decision or what the criteria was that led the agency to decide Bitcoin and Ethereum are cryptocurrencies and not securities. Ripple could then use the same to prove the similarity between the two top coins and its own native digital asset.

Also Read: Judge grants Ripple’s request for SEC’s internal trading policies as fair notice fight continues

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