Connect with us

Crypto

Ripple Lawyer Now Wants to Defend Ethereum Against Classification as a Security

Ripple (XRP) is prominent example of how a cryptocurrency can run the risk of being classified as a security in the US. Mischief now threatens Ethereum (ETH) as well, with one crypto lawyer organizing resistance. Ethereum’s price curve has so far shown itself unaffected by the new legal risks, but on the other hand, it is unable to develop its own momentum despite the upcoming major upgrade Shanghai.

Published

on

In the mammoth trial of the US Securities and Exchange Commission (SEC) against Ripple, the big issue is whether XRP should not be classified as a security and therefore fall under state regulation. The competent court in New York is working on a ruling and observers expect a signal.

However, in the meantime, the prosecutor’s office in New York has already launched the next initiative and wants to achieve in a lawsuit against the crypto exchange KuCoin that Ethereum (ETH) should also fall under the securities division. Crypto lawyer John Deaton, who already represents XRP investors, has recognized parallels and now also wants to represent investors in the Ethereum case.

if you want to read more details about the Ripple lawsuit and to find the most important business news of the day, download for free our companion app Born2Invest.

The crypto industry united against the U.S. authorities

Via Twitter, Deaton explained that ETH does not constitute a security in his view and that he wants to intervene as he did with Ripple’s XRP. To prepare a class action lawsuit, he is asking Ethereum US investors to issue mandates. Regulators (in the U.S.) are “out of control” and need to be resisted, he said. In an SEC case against cryptocurrency LBRY, Deaton had obtained on appeal that sales on secondary markets such as crypto exchanges remain non-admissible. He is likely to argue along these lines in the case of Ethereum as well, as ETH is being approached indirectly through the KuCoin crypto exchange

There had been fierce discord between Ethereum and Ripple (XRP) in August 2022, as top officials accused each other of misdirecting information on the testy topic of “security or not?” However, the increasingly sharp course of the SEC and other U.S. authorities against the crypto industry makes not only Deaton overlook old disagreements and instead emphasize necessary solidarity.

Bottom line: Ethereum under U.S. regulation would be a grim scenario

Ethereum’s price curve has so far shown itself unaffected by the new legal risks, but on the other hand, it is unable to develop its own momentum despite the upcoming major upgrade Shanghai. It is unlikely to please anyone at Ethereum to suddenly be mentioned in the same breath as Ripple and XRP because, in fact, the genesis of the two altcoins differs significantly.

ETH has also been subject to the SEC’s unofficial carte blanche granted by the infamous “Hinman speech”, which also plays a central role in the Ripple lawsuit. Attorney Deaton could, however, be right in his prediction that the different legal battlefields will influence each other.

__

(Featured image by WorldSpectrum via Pixabay)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in BLOCK-BUILDERS.DE, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.

Michael Jermaine Cards is a business executive and a financial journalist, with a focus on IT, innovation and transportation, as well as crypto and AI. He writes about robotics, automation, deep learning, multimodal transit, among others. He updates his readers on the latest market developments, tech and CBD stocks, and even the commodities industry. He does management consulting parallel to his writing, and has been based in Singapore for the past 15 years.