Recently, Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC) was interviewed in-depth by New York Magazine’s Intelligencer about why he believes bitcoin is a non-monetary cryptocurrency asset. However, Ripple’s authorized director Stuart Alderoty argued Gensler should “recuse himself from voting on any enforcement case that raises that issue,” insisting that the SEC chairman “has prejudged the outcome.”
Lawyer Sparks Twitter Debate on SEC Chief’s Crypto and Security Views
SEC Chairman Gary Gensler’s recent interview could have implications for the US securities regulator, as he was accused of openly expressing his preferences on the final result. Bitcoin.com News recently reported on this and Gensler shared his views during an interview with New York Magazine Intelligencer reporter Ankush Khardori. During the interview, there was a discussion in which the SEC chairman explained why he considers digital assets other than bitcoin (BTC) to be securities.
We were once called “crazy” for saying the SEC thought something. Safety was the goal, but now Gensler has publicly stated it. pic.twitter.com/Q9wFjIsNH7
—LBRY🚀 (@LBRYcom) February 28, 2023
On February 27, 2023, Ripple’s Chief Legal Officer Stuart Alderoty tweeted about Gensler’s public statements following the interview. Ripple is currently in a legal dispute with the SEC to determine if XRP tokens can be considered securities. Alderoty’s tweet read: “PSA Crypto Lawyer: Chairman Gensler has once again stated that all cryptocurrencies except BTC are unregistered securities. He must now abstain from voting on any enforcement action that raises that issue, since he has already adjudicated the outcome. Antoniu v. SEC (8th Cir. 1989)”.
Antoniu v. SEC raised concern over an individual by the name of Antoniu who appealed against a decision by the SEC to stop him from being a stockbroker. Antoniu claimed the SEC should be recused due to Commissioner Troy Paredes’s involvement in debarment proceedings, which clouded the case with the appearance of imprudence. The Court ruled in favor of Antoniu, stating that their statements implied that they had already established the facts of the case prior to hearing it. The case established that SEC workers in certain circumstances should be recused to avoid any appearance of improper conduct.
Jeremy Hogan, a legal professional and partner in Hogan & Hogan, sarcastically replied to Alderoty’s tweet stating that Chairman Gensler was “clearly speaking not as head of the SEC but in his capacity as a long-distance runner and lover of orange juice. So he is very effective.” Other Twitter users in Alderoty’s thread asked the lawyer if he would take legal action, with one person asking “Will you be able to handle it from a legal perspective [Stuart Alderoty]? How to drive, do you have to file motions for Gensler to take a break?”
Not everyone agreed, however, with one person calling the opinion “absurd.” “Chairman Gensler does not prejudice the value of any particular case. Even though one could make such an argument, which is absurd, it would only require the recusal to an enforcement action appeal and not his participation in voting to authorize enforcement motions,” the person responded to Alderoty’s tweet. Regarding the case Antoniu v. SEC, the Court dismissed all proceedings that had been brought against the commissioner. It directed the US securities regulator to conduct a new de novo assessment of the evidence without the involvement or participation of Troy Paredes.
