Pro-XRP lawyer John Deaton recently appeared on The Clinton Donnelly Show and shed light on the significance of Bill Hinman’s speech in June 2018. In this landmark speech, Hinman, who was the director of Corporation Finance at the SEC, declared that Ethereum was not a security. This statement provided much-needed regulatory clarity for Ethereum and the cryptocurrency market as a whole.
Deaton highlighted that while the controversy surrounding Bill Hinman’s Ethereum speech did not directly influence the judge’s decision in the Ripple case, it significantly affected the trial involving Ripple’s executives, Brad Garlinghouse and Chris Larsen.
“It didn’t affect the judge’s decision but it will affect the trial of Brad Garlinghouse and Chris Larsen because the SEC must attempt, which they can’t do, prove that they were reckless in not knowing that XRP is a security. But the judge, she did something very simple, and it’s a very great decision, it’s a really good decision, it’s a sound decision.”
The SEC must demonstrate that the defendants were reckless in not recognizing XRP as a security. The existence of conflicting opinions and potential bias within the SEC, as revealed by the Hinman documents, will likely play a pivotal role in this aspect of the case.
The talk also touched on some big issues in how cryptocurrency rules work. Deaton worried that the rules for who can invest in crypto favor rich people and leave out most others. He said we should make it fairer so more people can join in and grow their wealth with crypto.
Deaton also talked about why the head of the SEC, Gary Gensler, is making these rules. Some people think there might be secret reasons behind it, like trying to stop crypto. But Deaton didn’t go that far. He thinks maybe Gensler is just trying to make sure the big players in traditional finance can join the crypto game slowly.