XRP Lawyer Thrashes SEC's Crypto Scam Warning, Accuses Agency of Misleading Investors

The SEC warning on X stated, “Scammers often use innovations and emerging technologies like #crypto to perpetrate investment scams,” urging caution among investors.

A recent post by the U.S. Securities and Exchange Commission (SEC) regarding crypto scams has sparked a strong response from XRP lawyer Fred Rispoli. The SEC highlighted the use of emerging technologies like crypto in perpetrating investment scams, warning investors to be vigilant.

However, Rispoli countered this claim using X community notes, accusing the SEC of misleading investors. He stated that the agency's actions have led to hundreds of thousands of investors being scammed into purchasing crypto, only to be later "rugged" by the SEC.

This criticism underscores the ongoing tensions between the SEC and the crypto industry. Notably, the American watchdog permitted Coinbase to go public in 2021 but later clamped down on the exchange for allegedly selling securities.

The XRP lawyer's response to the crypto scams warning reflects a growing discontent amidst legal actions against major firms like Binance, Kraken, and Uniswap. These companies have faced scrutiny over alleged violations of securities laws, with the agency contending that many digital assets and trading platforms qualify as securities and should be regulated accordingly.

In a recent high-profile case, the SEC issued a Wells Notice to OpenSea, a leading NFT marketplace, threatening to sue the platform over the sale of NFTs, which it classifies as securities. This move echoes the regulator's past actions against other crypto firms.

OpenSea CEO Devin Finzer expressed surprise at the SEC's stance, arguing that the regulator's actions could stifle innovation in the digital collectibles space. He pointed out that the SEC has now entered "uncharted territory" and that many artists and creators could be adversely affected by these regulatory measures.

This aligns with Rispoli's claim of the SEC being behind ‘crypto scams’ that affect investors due to ambiguous regulation. Adding further complexity to the debate, Ripple CLO Stuart Alderoty invoked a 1976 SEC ruling, wherein the agency clarified that art galleries promoting and selling artworks for “investment motive” were not mandated to register with the SEC.

Alderoty argued that this precedent could apply to NFTs, which, like traditional art, are traded as collectibles rather than securities. He stated, "Fun fact: In 1976, the SEC ruled that art galleries, even when promoting and selling to buyers that had investment motives, didn’t need to register with the SEC."

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