Gene Hoffman, the COO of blockchain company Chia Network, is confident that Ripple will lose to the SEC.
The only possible outcome is that a federal judge will rule that Ripple’s sale of XRP made XRP a security
—Gene Hoffman
Hoffman says federal judges will find that most people bought XRP hoping its value would rise. Therefore, the arguments of Ripple and its supporters about the alleged usefulness of the cryptocurrency are unlikely to hold.
Hoffman, who has worked with the SEC for decades, has pointed out that the regulator hasn’t lost a Section 5 case in decades. He added that there is very little difference between XRP and LBRY Credits tokens. LBRY was defeated by the SEC in November. The court ruled that the start-up was offering LBC tokens as unregistered securities.
Selling XRP was illegal
Moreover, Ripple was already informed in 2019 by none other than Bill Hinman, the former director of the SEC’s corporate finance department. At the time, it was informed that XRP sales were considered illegal.
Hoffman agrees that Hinmans’ infamous 2018 Ethereum speech from the SEC was “a mess.” However, he is convinced that this has no influence on the case. The tech entrepreneur also criticized Ripple for misleading various parties within the crypto community about the true state of affairs.
It’s a shame that so many people were misled by Ripple.
— Hoffmann
Hoffman states that few of the top 100 largest cryptocurrencies are not securities in the United States.
The SEC’s lawsuit against Ripple was filed about two years ago. Ripple CEO Brad Garlinghouse expects the lawsuit to be resolved in the first half of 2023.