Charles Hoskinson, Cardano’s founder, has stated that he believes XRP is a Commodity and not a Security giving some nuance on his stand in the SEC vs Ripple case after being pressured by some XRP adherents.
“I’ve always taken a position that most layer 1 protocols aren’t securities,” Charles wrote in a thread of Tweets on Saturday. According to him, Ripple offers utility, is decentralized enough to have operators and builders worldwide, and survives its founders, which disqualifies it as a security. It was thus “bizarre and senseless” for the SEC to invoke the Howey test to prove its case against Ripple.
“The merits of the case should rest on the absurdity of applying securities regulation to something that has millions of independent participants in more than 100 countries who cannot be controlled by any fiduciary of a single company,” Charles added, suggesting that the SEC case would fail.
Regulators To Blame For Crypto Regulatory Muddle
Charles, who has taken a keen interest in the Ripple case since 2020, blamed regulators for shirking their responsibilities, describing their behaviour as the “root cause of our industries issue.”
“The legislative branch has been negligent in its duty to pass new laws to resolve the consequences of new technology. Regulators have to follow the law,” he said.
Without clear regulations, the crypto industry has been left at the behest of courts and state agencies such as the SEC and CFTC, who are divided on who should control the sector. According to Hoskinson, this outrage can only be solved through the enactment of bespoke regulations or the application of existing rules as regulators “see fit regardless if it makes sense or is fair.”
However, to him, CFTC could be used to police the crypto industry since they are principles-based, market-oriented, and global by nature. Moreover, “commodities survive those who aggregate them,” he added.
XRP Surges As Ripple Win “Nears”
Meanwhile, with the optimism of Ripple winning against the SEC in the ongoing case growing, XRP continues to shine. According to data from onchain analysis firm Santiment, this week has seen the network’s highest number of new addresses created in three months.
Furthermore, despite plunging by over 85% in June, XRP’s price has already recuperated by over 70%, breaking key resistance levels which could be pivotal to the cryptocurrency surging towards its all-time highs. The cryptocurrency traded at $0.52 after a 4.69% increase in the past 24 hours. XRP is the sixth largest crypto asset with a market capitalisation of $25.9B.