Hinman speech contained “made-up analysis”, Ripple’s Chief legal officer says

Hinman speech contained “made-up analysis”, Ripple’s Chief legal officer says

By Benson Toti - min read
  • Former SEC official William Hinman delivered his speech in June 2018, commenting that Bitcoin and Ether were not securities.
  • SEC sued Ripple Labs in December 2020, alleging that the company illegally sold unregistered securities in the form of its XRP token.
  • Ripple attorney Stuart Alderoty says the documents contained “made-up analysis.”

Ripple news today is that the US-based company continues to edge closer to a verdict in its battle against the US Securities and Exchange Commission (SEC). 

This follows Tuesday’s release of documents related to a speech by former SEC official William Hinman, which was delivered in June 2018. 

The price of XRP, the native Ripple cryptocurrency that the SEC alleges is a security in a lawsuit filed in 2020, rose more than 8% to above $0.55.

Ripple lawyer comments on release of Hinman emails

The document’s release to the public means Hinman’s views about cryptocurrencies deemed as securities. 

Specifically, the former SEC Division of Corporation Finance official highlighted in his 2018 speech that Bitcoin (BTC) and Ethereum (ETH) were not securities.

Commenting on the release of the files, Ripple’s Chief Legal Officer Stuart Alderoty tweeted:

It’s been 5 years since Bill Hinman gave his infamous speech – and through the SEC’s lawsuit against @Ripple (and 7 court orders), we can finally share what happened behind the scenes through the now public emails / drafts of the speech.”

On Hinman’s comments, Ripple’s legal chief stated the ex-SEC official ignored warnings about his remarks and that he included “made up analysis with no basis in law.”

We now can all see Hinman ignored multiple warnings that his speech contained made-up analysis with no basis in law, was divorced from the Howey factors, exposed regulatory gaps, and would create not just confusion, but “greater confusion” in the market,” he added.

A refresher: Hinman, as Head of the SEC’s Corp Fin, gave a speech in June 2018 declaring that a token is not a security once it becomes “sufficiently decentralized” and he invented factors to consider when making a “sufficiently decentralized” determination.

It is these statements that are now at the center of Ripple’s defense, with the company having maintained since December 2020 that XRP is not a security. 

The belief that the SEC is losing this case is the reason the community’s sentiment has become so upbeat in recent weeks.