Ripple uses statements from former SEC corporate finance director William Hinman that ETH is not a security. So the company wants to prove to the court that the same applies to XRP.
Last year, the US Securities and Exchange Commission (SEC) accused Ripple and its executives of conducting a $ 1.3 billion ICO and violating US securities laws. The trial is still ongoing. Ripple intends to convince the court that the SEC claims against the company are unfounded and unfair.
To do this, the company is going to use the statements of the former SEC employee William Hinman (William Hinman). In 2018, he said that ether was decentralized enough that it could not be a security or an investment contract that would profit from the actions of the project management. Ripple believes XRP should be treated the same as Bitcoin and Ether. In other words, XRP coins should not be classified as securities, and the company should be exempted from registration with the SEC.
However, after this statement, Hinman himself came under the scrutiny of the regulator. While at the SEC, Hinman received a $ 1.6 million payout from his law firm, Simpson Thatcher, to which he returned in 2018, according to media reports. The firm serves on the board of directors of the Enterprise Ethereum Alliance, which is exploring corporate use cases for Ethereum. The SEC claims that Hinman expressed his personal opinion, and did not speak on behalf of the department. At the same time, the Commission acknowledged that its staff helped him compose the text of the speech. However, the SEC filed a motion with the court to overturn Hinman’s testimony.
District Court Judge for the Southern District of New York Sarah Netburn rejected the regulator’s motion. Hinman must attend the testimony. This can be considered a small victory for Ripple in the battle with the SEC. However, the outcome of the “war” is not yet determined.
Earlier, Ripple CEO Brad Garlinghouse said that if Ripple loses the case, the company could ditch XRP and replace it with another crypto asset. In addition, Ripple plans to go public after the end of its legal battle with the SEC.
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