The SEC has been accused of taking bribes from those it regulates. How can the SEC be trusted to regulate cryptocurrencies when it is so clearly in the pockets of those it’s supposed to oversee?
The sec corrupt reddit is a question that many people are asking. Is there evidence of corruption at the SEC?
CryptoLaw’s Founder and Host, John E. Deaton
When you peel back the layers of the Ripple case, analyze its origins, and evaluate important facts connected to some of the case’s major players at the Securities and Exchange Commission, a bigger narrative emerges that can’t be ignored.
While in office, former Chairman Jay Clayton, ex-Corporation Finance Director William Hinman, and ex-Enforcement Director Marc Berger took very specific measures involving very particular cryptocurrencies. In the meanwhile, they have very particular financial interests in cryptocurrencies, which have benefitted from those activities, while millions of ordinary cryptocurrency investors have been directly damaged.
Those are the undeniable facts, and they hint to something very worrisome underlying the SEC’s filing of the Ripple case on Clayton’s last day in office. How can we look at these data and reject the possibility of collusion?
Here’s a rundown of what we know:
- We know that before joining the SEC, both Clayton and Hinman received large fees for assisting Chinese internet behemoth Alibaba Group with its 2014 IPO on the New York Stock Exchange. Alibaba’s Alipay is the world’s biggest digital mobile payments network, and its IPO in New York signaled China’s intention to dominate global digital payments.
- Chinese bitcoin miners have gained control of 65 percent of the bitcoin network hash rate by 2016. Because bitcoin is a proof-of-work token, China has complete control over the network.
- William Hinman was appointed Director of the SEC’s Division of Corporation Finance on May 9, 2017. Hinman resigned his position at the legal firm Simpson Thacher – which sits on the Enterprise Ethereum Alliance and represents cryptocurrency-related financial interests – after being appointed to the SEC, but continued to earn millions in payments from the company. In other words, while working in a high SEC position, Hinman had a clear financial stake in any SEC regulatory action connected to cryptocurrencies! This was “a bit disconcerting,” according to one former SEC ethics lawyer. (Just a tad?)
- Clayton officially proclaimed bitcoin not to be a security in 2018, causing the price of bitcoin to skyrocket.
- Hinman stated that the Ethereum currency, ether, is not a security during a 2018 Yahoo Finance conference in San Francisco. Ether’s value has soared.
- Simpson Thacher guided Canaan, a Chinese crypto mining firm, through its first public offering in 2019. Canaan is a company that develops bitcoin mining technology and is openly positive on the cryptocurrency. When this occurred, Hinman was still at the SEC, receiving payments from Simpson Thacher.
- Chairman Clayton received a letter from then-Director of National Intelligence John Ratcliffe in early November 2020, expressing his increasing worries about China’s crypto supremacy and the threat it presents to US national security.
- Hinman resigned from the SEC on December 4, 2020.
- The SEC Enforcement division, headed by Berger, filed a complaint against Ripple and its officials on December 22, 2020, Clayton’s final day in office, claiming that XRP sales over a seven-year period were unregistered securities transactions. According to the lawsuit, “all sales” were unlawful, trapping millions of retail XRP holders who had never heard of Ripple but had been trading the digital currency for years. The value of XRP has dropped dramatically.
- Acting Enforcement Director Marc Berger announced his retirement from the SEC on January 12, 2021, and will leave the agency at the end of the month.
- The People’s Bank of China (PBOC) has moved closer to a full-scale launch of their Digital Yuan by releasing millions of yuan in testing as of March 2021.
- Clayton took a job with One River Asset Management, a digital asset hedge fund focusing only on bitcoin and ether, according to Bloomberg on March 29, 2021.
- The SEC’s lawyers have been battling tooth and nail in their lawsuit against Ripple to avoid complying with the One River Asset Management subpoena, most likely to prevent potentially damning information regarding Clayton’s pay from coming to light.
- Berger will join Hinman as a partner at Simpson Thacher, according to Bloomberg on April 15, 2021.
None of these facts, nor the timeline of how it all happened, have been contested by Clayton, Hinman, Berger, or the SEC. Any objective assessment reveals that these three individuals had and/or continue to have financial interests in the SEC officials’ conduct.
Why haven’t these people, Simpson Thacher and One River, been called to account for these facts?
Why aren’t these facts being examined when they point to obvious wrongdoing? If now is not the moment to explore, when is it? With the entire market value of cryptocurrencies approaching billions of dollars, when is it?
If no one else would, it is up to the millions of retail XRP holders who were directly affected by these acts to demand answers.
The SEC has been accused of being corrupt. This is a question that many people have been asking. Reference: crypto legal.
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