Crypto community rallies against VC who described XRP as security

Several crypto community members have criticized venture capitalist Jason Calacanis for saying XRP is a security.

In a May 9 tweet, Calacanis said Ripple could have saved itself from the Securities and Exchange Commission’s (SEC) legal tussle if it had registered with the regulator. He said:

“It would have cost little for the Ripple team to have registered it as a security and played by the rules —- like everyone else in the industry does.”

Calacanis said he has invested in over 300 startups. According to his website, these firms include Robinhood, Uber, Trello, etc.

Ripple CEO says the US has no framework to register digital assets

In his response, Ripple CEO Brad Garlinghouse said the United States has no framework for registering digital assets.

Garlinghouse added that it was embarrassing for Calacanis to comment on subjects he lacked knowledge about. He said:

“We’re all used to you making controversial statements and trolling about things you know nothing about.”

The Ripple CEO had previously said the SEC has “no infrastructure for a ‘registered token’ to trade nor provided any clarity” for these tokens.

Crypto community rails against Calacanis

Meanwhile, Calacanis’s comment generated heated responses from the crypto community, who explicitly told him about the U.S. lack of clear-cut regulation for the crypto industry.

Shapeshift CEO Erik Voorhees said the XRP project would have been dead if it had registered as a security because no exchange would support it. Voorhees added that no single crypto asset registered as a security had found any adoption or use cases.

Loopify opined that it was not easy to register a digital utility token with the SEC, citing the regulator’s issues with Coinbase. Besides that, Loopify noted that the regulatory chief Gary Gensler has struggled with making clear rules for the crypto industry.

BitGo CEO Mike Belshe advised Calacanis to try registering a digital asset as a security before he makes statements like this.

Others also pointed out how difficult it was for a digital asset firm to register with the SEC because of the regulatory uncertainty prevalent in the U.S.

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