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The SEC has argued in court that XRP has no utility, and one lawyer believes that this is the best example of the regulator’s incompetence.
The lawyer also slammed the SEC’s claim that XRP holders are in a “common enterprise” with Ripple, citing research that suggest most XRP holders don’t believe they own a piece of the company.
The Securities and Exchange Commission of the United States has made a number of arguments in order to increase its prospects of winning a legal case against Ripple Labs. None has been more ridiculous and ill-informed, according to one legal expert, than the accusation that XRP has no utility. This, according to lawyer John Deaton, is the best example of the SEC’s approach to cryptocurrencies being based on ignorance.
Deaton is the founder of Deaton Law Firm, but he’s best known in the crypto community for founding Crypto Law, a repository for legal and regulatory news and analyses for digital assets in the United States. He has been particularly active in the XRP community, and was one of the digital asset holders to file a Motion to Intervene in the SEC vs. Ripple lawsuit. In the Ripple vs. SEC case, the judge denied XRP holders’ motion to intervene.
The legal expert focused on one of the SEC’s “most heinous allegations” in a July 7 blog post.
Jorge Tenreiro, an attorney for the Securities and Exchange Commission, said in court on March 19 that “The court has now mentioned an XRP utility. Your Honor, we disagree about whether or not such utility exists.”
For starters, Deaton claims that even the presiding judge, Sarah Netburn, has demonstrated that she knows more about XRP’s utility than the SEC. “Not only does the digital asset have economic value,” Judge Netburn said, “but it also has a utility, and that utility distinguishes it, I believe, from Bitcoin and Ether.”
Judge Netburn, as well as millions of XRP holders, companies like Ripple, BitPay, Spend the Bits, Japan’s SBI, and others, all understand the utility of XRP, according to Deaton.
The SEC’s case against XRP “it’s illogical
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The legal expert said that XRP has demonstrated its utility over time. Because of its open-source nature, users can pay for goods and services without relying on Ripple in any way.
According to Cryptwerk, over 1,300 businesses already accept Bitcoin as a form of payment. They include web hosting and other web services, as well as tourism, gaming, travel, and entertainment.
Over 19,000 XRP holders from all over the world have contacted Deaton, according to him “Many of them get their salaries in XRP and purchase for groceries and pay for gas with XRP-powered debit cards. Despite the SEC’s accusations, these people are not in a “common venture” with Ripple.”
The lawyer also mentioned a Stedas Crypto poll in which over 90% of over 4,000 respondents claimed they don’t believe they hold a share in Ripple just because they own the cryptocurrency.
The SEC’s claim that there is no XRP without Ripple is not only incorrect, but also illogical. The SEC’s lawsuit was the first time many XRP holders had heard of Ripple, prompting many of us to wonder, “What is Ripple?”
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