XRP holder’s lawyer John Deaton has highlighted a conflict of interest former SEC Chair Jay Clayton showcased with Ripple and XRP.
Deaton remains an advocate and promoter of XRP as a payment technology.

John E. Deaton,  the lawyer who represented XRP holders, has questioned the role of Jay Clayton, the former Chairman of the United States Securities and Exchange Commission (SEC) over the regulator’s enforcement action against Ripple and its CEO Brad Garlinghouse highlighting glaring conflicts of interest.

XRP Lawyer Unveils the Jay Clayton Conflict

Deaton, in a series of posts on X (formerly Twitter), uncovered layers of Clayton’s professional entanglement and affiliations, all of which point to impartiality in the SEC’s decision to pursue an enforcement action against Ripple. Deaton also mentioned that the Ripple vs SEC lawsuit might have set a clog in the firm’s progress, thereby handing rivals, including Ethereum (ETH) and Consensys a clear advantage.

Markedly, Deaton challenged Clayton, who, during his confirmation, agreed he would be conflicted from voting against an enforcement action involving one of the clients of Sullivan & Cromwell (S&C). But, instead, he voted for regulatory action against Ripple, a formidable adversary of his law firm’s client.

As noted by Deaton, some lawyers and partners of Clayton from Sullivan & Cromwell worked at Consensys, a pivotal entity in the Ethereum ecosystem. Patrick Berarducci, one of Clayton’s partners, served as deputy general counsel at Consensys, and also co-chair of The Brooklyn Project, which claimed to be building an alliance with the SEC related to crypto.

Also, Clayton’s law firm brokered the merger deal between Quorum and Consensys using JPMCoin, a direct competitor to Ripple and XRP.

Additionally, after his time as SEC chairman, Clayton joined entities like Apollo Group and One River, which have substantial stakes in cryptocurrencies. Notably, Clayton joined One River after the latter’s $1B bet on BTC and ETH, the only two crypto assets given regulatory clarity in a more controversial speech by SEC Exec William Hinman.

Before now, Deaton has drawn connections between the former SEC chairman and William Hinman in the declaration of ETH as a non-security. Deaton’s tweets came in response to Brian Costello’s remarks on X. Brian alleges that the SEC, under both past and current chairman, may have covered potential financial misdeeds connected to Chinese business executives like Sequoia’s Neil Shen.

John Deaton Says Ripple and the SEC May Likely Reach a Settlement

In September, Deaton spoke on the possibility of Ripple and the SEC settling its ongoing case. Some market players have highlighted that Ripple is open to a settlement if the SEC affirms that the XRP is not a security. However, attorney John insisted that a settlement can be reached on a different condition.

He said the only way the settlement will be finalized is if the Judge handling Coinbase’s motion grants the exchange motion to dismiss the case. According to the attorney, if the motion is granted, it would mean that the token sales on exchanges in a blind bid/ask transaction do not fall under U.S. securities laws.

Furthermore, the CryptoLaw founder recently endorsed XRP as one of the most powerful cryptocurrencies used as a payment option. To further bolster his claim, he cited TapJets’ utilization of the XRP token for payment. Markedly, TapJets is an on-demand private jet booking platform. 

Beyond TapJets’ adoption of XRP as a payment alternative, Ripple and XRP adoption across several industries is fast becoming a trend, especially after Judge Analisa Torres declared in a July 13th ruling that XRP is not a security when traded on secondary marketplaces.

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Filed under: Bitcoin - @ October 24, 2023 3:19 am