Reaper Financial CEO Patrick Riley recently took a dig at the Ethereum community in light of reports suggesting that the SEC will classify Ethereum as a security. Riley cleverly twisted a tweet from Ethereum co-founder Vitalik Buterin in 2022 to criticize the Ethereum community’s response to the SEC’s crackdown. He argued that the community had forfeited its moral standing by sacrificing XRP to gain control over the crypto industry with the help of the Democrat Party and corrupt SEC officials.
This echoes Buterin’s previous remarks in 2022, where he hinted at a grudge held by the Ethereum Foundation against Ripple. Buterin suggested that the Ethereum community was not obligated to support XRP against the SEC after Ripple labeled it “China-controlled” in a lawsuit. Riley brought up this tweet again as the SEC moved to regulate ETH.
The Ethereum and XRP communities have been at odds for years, competing to be the second-largest cryptocurrency after Bitcoin. Ethereum gained an advantage over XRP in 2018 when the former director of the SEC’s Corporation Finance division, Bill Hinman, declared Ethereum a non-security. This declaration solidified ETH’s position ahead of XRP. In 2020, the SEC charged Ripple with unregistered securities sales of XRP, further bolstering Ethereum’s position.
XRP community members speculated that the lawsuit against Ripple was orchestrated by Ethereum and “corrupt SEC officials.” Hinman, who was a partner at Simpson Thacher & Bartlett LLP before joining the SEC, had ties to the Enterprise Ethereum Alliance (EEA), which promoted Ethereum as an enterprise solution. Hinman maintained connections with Simpson Thacher while at the SEC and received millions of dollars in profit sharing from the firm.
With the SEC now seeking to classify ETH as a security, some XRP community members see this as a positive development. However, Ripple CEO Brad Garlinghouse believes that the SEC will fail in its attempt, just as it did with XRP.
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