The US SEC has appealed to conceal documents of Hinman’s speech from the ongoing Ripple case, sparking outrage in the crypto community.
What was Hinman’s speech about?
The former Director of the Division of Corporation Finance at the U.S. Securities and Exchange Commission (SEC), William Hinman, once discussed the application of U.S. securities laws to digital assets. His talk is called Hinman’s speech when referring to the Ripple-SEC case.
Speaking at the Yahoo Finance All Markets Summit in 2018, Hinman provided guidance on how the SEC would approach the regulation of digital assets, including bitcoin and ethereum. He said, in particular, that digital assets should not be considered a security and, therefore, be subject to the regulatory framework for securities.
In the current case against SEC, Ripple uses Hinman’s speech as important evidence for providing clarity on how the SEC approached the regulation of digital assets.
SEC vs Ripple: recent developments
On Dec. 22, SEC filed a motion to seal Hinman’s speech documents. In addition, the SEC also requested that the documents should be censored from the defendants’ papers. Some of the SEC’s requests for withdrawal include identification and credentials of SEC authorities, as well as private and financial SEC data.
The request for the redaction of information on the SEC’s expert witnesses and internal documents comes a few weeks after Ripple delivered its final litigation against the SEC on Dec 2nd. Ripple and the SEC have been in a two year long court battle. Their friction has also extended to aggressive tweets, with Ripple highlighting the SECs oversight of Wells Fargo’s alleged mismanagement of consumer funds.
Ripple and the SEC also previously filed a joint motion asking for more time for the lawsuit.
On October 21st, Ripple reported that it obtained access to the Hinman Speech Documents. Despite this, the SEC insisted that the documents stay secret because of their sensitive nature.
In a prior case, the courts had rejected the SEC’s request to keep the Hinman records confidential. The US judge also criticized the SEC for acting hypocritically by asking for evidential documents to be concealed. Cardano
Ripple insists that Hinman’s speech is a significant piece of evidence that will help their case with the US regulators. Hence, it should not be withheld and regarded as irrelevant. Brad Garlinghouse, Ripple’s CEO, mocked SEC chairman Garry Gensler for chasing his company, while completely ignoring the FTX case.
The SEC’s proposal has drawn criticisms from the crypto community and XRP supporters. Some hint at the corruption in the agency and claim that Ripple will eventually win the case.
Others call for transparency, urging the SEC to make the documents public to US citizens.
Same as Garlinghouse, crypto Twitter thinks that the regulator is ‘more busy annoying a legit company’ than going after SBF.