John Deaton Wants SEC Chair to Resign After $1.75M Fine in Debt Box Case

Deaton has called for the resignation of SEC Chairman Gary Gensler following the agency’s loss in the lawsuit against crypto firm Debt Box. 

Pro-XRP lawyer John Deaton has stirred controversy in the crypto community by calling for the resignation of SEC Chairman Gary Gensler. This demand comes in the wake of an ongoing court case and growing criticism of the SEC’s regulatory approach to cryptocurrency.

I am very proud of the fact that I was one of the very first people to battle @GaryGensler’s @SECGov, serving as amici curiae in the @Ripple, @LBRYcom and @coinbase cases. I sued the SEC on January 1, 2021 and for more than three years I argued lawyers at the SEC were… https://t.co/ssOgWzgGuK

— John E Deaton (@JohnEDeaton1) May 28, 2024

Deaton alleges that the SEC, under Gensler’s leadership, is deliberately undermining key figures in the crypto space through bad-faith actions and persistent harassment. This includes targeting Ripple’s executives, such as Brad Garlinghouse and Chris Larsen.

Calling for a Change in SEC Chair

Following a ruling in which the SEC was fined $1.75 million for misleading conduct in the Debt Box case, pro-XRP lawyer John Deaton has called for the resignation of SEC Chairman Gary Gensler. Deaton argues that the SEC, under Gensler’s leadership, has overreached its authority, leading to financially damaging investigations into companies like Ripple, LBRY, and Coinbase. He has participated as amicus curiae in major cases against these firms, criticizing the SEC’s tactics, particularly in the LBRY case.

Deaton highlighted that SEC representatives publicly admitted their goal was to bring LBRY to its knees through exorbitant legal fees, sparking outrage within the crypto community. He also pointed out similar harassment of Ripple executives Brad Garlinghouse and Chris Larsen, citing these actions as evidence of the SEC’s bad faith under Gensler. This aggressive regulatory stance has prompted Deaton and others to call for accountability and reform within the agency.

The debate primarily centers on the SEC’s approach to enforcing securities laws within the digital asset market. The SEC has initiated several enforcement actions, asserting that certain digital assets are securities and thus fall under its regulatory jurisdiction. This approach has led to litigation with significant implications for the legal framework governing crypto markets.

Beyond the Debt Box case, the SEC’s confrontations with various crypto organizations have been contentious. Notably, Ripple Labs is engaged in a legal battle over whether its XRP token qualifies as a security. Critics, including John Deaton, argue that the SEC’s regulation is unpredictable and overbearing, potentially stifling the growth of the emerging digital asset industry.