Trump Appoints Former SEC Chair Behind XRP Lawsuit as New SDNY Attorney

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Trump Installs Former SEC Chair Responsible for XRP Legal Battle as New SDNY Lawyer

Jay Clayton, the former head of the SEC, has been chosen by Trump as the new attorney for the Southern District of New York (SDNY). Clayton was responsible for initiating the SEC’s lawsuit against Ripple. Despite promising to ease the scrutiny on crypto in the SDNY, he was at the forefront of one of the most significant enforcement actions in the industry.

In an attempt to sidestep a contentious Senate confirmation process, Trump plans to leverage a procedural loophole, much to the dismay of Senator Chuck Schumer. This appointment has stirred concerns regarding the allegiance of crypto’s new political backers.

Jay Clayton’s Involvement in the Ripple Case

President Trump has vowed to implement more favorable regulations for cryptocurrency, signaling his intention to direct prosecutors to halt enforcement actions. Clayton was initially appointed for this position back in November and has now assumed the role of Acting US Attorney. However, skepticism persists due to his role in filing the SEC’s lawsuit against Ripple back in 2020.

The case against Ripple is often seen as a pivotal moment during the tenure of Gary Gensler at the SEC, but it was Clayton who originally launched this significant legal battle. He served as the SEC Chair from 2017 until 2020, resigning just a day after filing the lawsuit against Ripple.

Fast forward to today, and Clayton has found himself critiquing the government’s stance on cryptocurrencies. During a televised segment last year, he publicly denounced Gensler’s crypto regulations, which left Ripple CEO Brad Garlinghouse outraged.

Watching this clip makes my blood boil. The hypocrisy is shocking. @CNBC @SquawkCNBC should be calling him out.

(As a reminder, Jay Clayton brought the Ripple case against me and Chris Larsen, then left the building the very next day.)

— Brad Garlinghouse (@bgarlinghouse) October 28, 2023

Debate Over the Appointment Procedure

As of today, there has been no official response from Ripple regarding Clayton’s recent appointment. Trump’s approach avoids the usual rigorous Senate confirmation hearings, using a strategy that permits local district judges to appoint Clayton after a waiting period of 120 days.

Reports suggest that this maneuver could enable Clayton to complete a full term as Acting US Attorney without undergoing a formal confirmation process. Senator Chuck Schumer has voiced his opposition, stating that Clayton “lacks fidelity to the law.”

Related: $2.3 Trillion Liquidity Shock: Franklin Templeton Says XRP Is Next in Line for Massive Inflows

This unfolding situation underscores the growing influence of the crypto lobby in politics, while also revealing the precarious nature of such alliances.

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