Ethereum co-founder Vitalik Buterim recently joined and applauded the Ethereum Community in their pushback against regulations that privilege ETH over other cryptocurrencies.
David Hoffman, founder of decentralised media and education platform Bankless, tweeted that he wouldn’t have minded if they had restricted XRP.
Buterim tweeted on 18 Aug, 2022 claiming that XRP had already lost their right of protection when they “tried to throw us under the bus as ‘China Controlled’”. The response from Buterin created a storm among XRP followers on Twitter, and the debate was later joined by Schwartz himself.
Ripple is facing an ongoing court battle with the United States Securities and Exchange Commission (SEC), in which Ripple was alleged to be engaging in illegal securities offering through sales of XRP. Ripple has disputed the SEC’s findings, arguing that XRP should be treated as a digital currency rather than an investment contract or security.
In defense, Ripple argued on the grounds of public policy. Stating that if Bitcoin and Ether are two Chinese-controlled virtual currencies that the SEC has determined not as securities, XRP should therefore not be regarded as a security since they are similar in nature.
It even elevated the argument to the level of national security, claiming that if the court finds XRP to be an investment contract, it would amount to ceding the innovation in the cryptocurrency industry to China.
David Schwartz reaffirmed Ripple’s earlier claims that Bitcoin and Ether are securities and compared miners in the ecosystem to shareholders of eBay.
Just as eBay stockholders want to leave as much friction between buyers and sellers as they can because that's their revenue stream, so do miners in ETH and BTC. That's part of why they have higher fees than XRPL. 2/2
— 𝙳𝚊𝚟𝚒𝚍 𝚂𝚌𝚑𝚠𝚊𝚛𝚝𝚣 (@JoelKatz) August 18, 2022
Schwartz proceeded to ask Buterin whether the debate should be settled by the market or the government.
Ripple has been claiming that the SEC has been favoring Ethereum and having a clear bias against it. Ripple CEO Brad Garlinghouse contended that the SEC has helped ETH overtake XRP as the No. 2 cryptocurrency. More recently, he said to Protocol that if Ripple loses the case in the US, they will consider moving to another jurisdiction.