SEC Chair Gary Gensler Said That He Isn’t Happy with the Court’s Ruling on Ripple’s XRP

On Monday, July 17, SEC Chair Gary Gensler publicly spoke on the court’s decision last week for giving a non-security status to the retail use of Ripple’s native cryptocurrency XRP.

However, the court has granted a partial win to the SEC stating that the institutional sales of XRP shall qualify as securities. But it seems that SEC chief Gary Gensler isn’t quite happy with it.

According to Gensler, the agency expressed satisfaction with the decision as it safeguarded institutional investors and countered Ripple's fair notice argument. However, the judge's ruling concerning retail investors remained a contentious issue.

At a National Press Club luncheon on Monday, Gensler said: “While disappointed on what they said about retail investors, we’re still looking at it and assessing that opinion”. Gensler's comments coincide with the SEC's ongoing endeavors to establish more defined regulatory frameworks for cryptocurrencies. The court's classification of XRP as a security further complicates the existing challenges of defining and regulating digital assets.

The ruling has sparked a range of responses within the crypto community. Supporters of XRP see it as a validation of the token's credibility, while critics emphasize the importance of clearer and more consistent regulations in the crypto industry.

Although Gensler expressed his disappointment with the court's ruling, it is crucial to recognize that the decision does not exempt Ripple or its executives from potential regulatory investigation. The ruling specifically pertains to the classification of XRP as a security and does not encompass other aspects of Ripple's activities.

The classification of digital assets presents a challenging dilemma, and global regulators are facing the task of effectively supervising the rapidly changing cryptocurrency market. As the crypto industry evolves, it is vital for regulatory bodies to find the right balance between safeguarding investors and nurturing innovation.

When asked about the SEC's approach to regulation, Gensler highlighted the agency's involvement in rule-making initiatives concerning brokerage dealers, exchanges, and the protection of safe custody. This indicates that the SEC is actively engaged in developing and implementing more defined regulatory frameworks for different areas of the cryptocurrency industry.

In recent months, the SEC has targeted major cryptocurrency companies like Binance and Coinbase, accusing them of failing to register with the agency. Additionally, Binance has been accused of providing false information to customers. “So what’s next? We’re going to continue to try to bring firms that may not be into compliance into compliance without prejudging any one of them and trying to ensure that we protect the investing public,” Gensler said.