Gary Gensler, head of the US Securities and Exchange Commission (SEC), is once again facing fierce criticism from the crypto industry. The CEO of Ripple (XRP), Brad Garlinghouse, calls Gensler “mentally ill” and a “political liability”.
Ripple (XRP) and the US Securities and Exchange Commission (SEC) are unlikely to become friends, and have been meeting in court for three years. The fact that Ripple CEO Brad Garlinghouse is now attacking SEC Chairman Gary Gensler on a personal level is certainly not a peace offering. At the World Economic Forum in Davos, Garlinghouse used a TV interview to make a borderline attack on Gensler.
The SEC boss was a “political liability” for the US and Gensler’s behavior was “insane”, Garlinghouse said. The Ripple CEO linked his comments to the SEC’s anti-crypto course under Gensler. The regulator has sued leading crypto exchanges such as Binance, Coinbase and Kraken in 2023 and wants to have more than 50 cryptocurrencies classified as securities. By contrast, Ripple has been defending XRP in court since the end of 2020 and was able to celebrate its first partial victory in the summer of 2023. But if someone like Gensler “tries the same thing over and over again and thinks he can somehow win in court”, he can be considered “insane”, said Garlinghouse.
He emphasized that the SEC was ultimately harming the US economy and citizens with its flood of lawsuits against the crypto industry. Gensler is therefore proving to be a “political liability”, said Garlinghouse. Gensler was appointed to the SEC chair in 2021 by US President Joe Biden, and the position is filled politically. Like other crypto companies and celebrities, Garlinghouse and Ripple are part of a group of donors who are supporting crypto-friendly candidates in the 2024 US elections by donating millions.
Most recently, the SEC had to rethink its approach to Bitcoin ETFs, which was also triggered by a court ruling. At the World Economic Forum in Davos, the start of trading in Bitcoin ETFs last week attracted a great deal of interest.
Conclusion: SEC chief Gensler “red rag” not only for Ripple
There are good reasons to view the SEC’s efforts towards the crypto industry as overregulation – the court successes of Ripple and XRP as well as for Bitcoin ETFs are among them. But even from a European perspective, it sometimes gets lost that the 66-year-old Gensler’s role at the SEC is first and foremost to define him as an investor protector. The collapse of the US crypto exchange FTX at the end of 2022 aroused deep skepticism at the SEC and weighed on the crypto sector as a whole. Garlinghouse for Ripple and XRP will therefore not only earn applause for his outbursts against Gensler.