Charles Hoskinson, the founder of Cardano, has criticized Ripple’s litigation strategy in the ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC) regarding the classification of XRP as a security.
Hoskinson expressed his frustration in a recent Ask Me Anything (AMA) session, stating that Ripple’s focus on the alleged bias of the SEC towards Ethereum is unproductive and not helpful for the litigation.
Hoskinson’s comments come in the wake of the growing controversy surrounding Ethereum, known as “ETHGate,” where investors claim that Ethereum received a “free pass” from regulators. At the same time, XRP and other cryptocurrencies were targeted. The theory further claims that Ethereum’s decentralization was manipulated, and the SEC allowed Ethereum to move ahead while penalizing other cryptocurrencies.
Hoskinson acknowledged that the SEC’s treatment of different cryptocurrencies has been inconsistent, but he dismissed the allegations of fraud by the Ethereum Foundation as hard to prove.
“It (ETHgate) was a campaign based on a lie. Even the founders of XRP refused to acknowledge is a lie. I would love to see Brad, Shwartz and others come out and physically say that all of this attack on our side is based on a lie.” Said Hoskinson.
Addressing the core of Ripple’s argument, Hoskinson questioned the efficacy of their litigation strategy, particularly in light of their accusations against Ethereum. He argued that Ripple’s insistence on Ethereum receiving preferential treatment undermines their case against regulatory scrutiny.
“Your litigation strategy, your fighting the US government, is to go and say ‘the only reason Ethereum is not a security is because they bribed the US government,’” Hoskinson remarked, pointing out the inherent contradiction in Ripple’s stance.
That said, while the allegations of fraud by the Ethereum Foundation are hard to prove, the theory does have some merit. The SEC has been criticized harshly for its alleged inconsistency in choosing which initial coin offerings to label “unregistered securities offerings.”
Recently, pro-ripple lawyer John Deaton blasted the regulator for not investigating ETHGate, stating that “the truth doesn’t guide them” and “they don’t care about justice and free markets in a level playing field. All they care about is their pockets.”
Notably, the SEC has struggled to make a strong case against XRP, particularly given its previous classification of Bitcoin and Ether as “non-securities.”
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