Support from 75,000 XRP holders is again drawing attention as a factor behind Ripple executives being able to hold out in a legal battle with the U.S. Securities and Exchange Commission (SEC).
On July 12, blockchain outlet U.Today reported that U.S. Senate candidate and crypto-focused lawyer John Deaton (존 디턴) joined discussions around the Ripple case and said many XRP holders played an important role in sustaining management at the time.
The discussion began after Ripple CEO Brad Garlinghouse again mentioned the legal dispute with the SEC. Garlinghouse recalled that the company had nearly shut down at the time. Former Ripple chief technology officer David Schwartz also joined in, saying lawyers at the time told senior Ripple executives it would be difficult to save the company and even advised each of them to pursue a settlement. Schwartz said there was even an assessment that the company was in a "beyond saving" state.
Deaton said he fully believed Schwartz's account and directly criticised the SEC's litigation strategy. He argued that the SEC's decision to sue not only the company but also Garlinghouse and Ripple chairman Chris Larsen was a pressure tactic to push the two men into a quick settlement. Schwartz saw such individual charges as a predictable response in similar cases, but Deaton interpreted it as a tactic to intimidate management.
As grounds for his claim, Deaton also mentioned a past interview by former SEC chair Jay Clayton. Clayton had explained the benefits of naming individual executives in enforcement actions, and Deaton said those remarks could apply even in cases without fraud allegations. Clayton's interview took place before the Ripple lawsuit, but Deaton said the same approach was used in the Ripple case.
Deaton also argued that such an approach could place personal and financial pressure on executives fighting the U.S. government in court. He said if executives personally had to bear litigation burdens apart from the company's defence, incentives for an early settlement could increase. He highly praised Ripple executives for not backing down while the SEC case dragged on.
The role of XRP holders also resurfaced in the process. Deaton stressed that tens of thousands of XRP holders helped management and lent support throughout the lawsuit, ultimately playing a role in a victory against the SEC. He praised both Ripple executives and the 75,000 XRP holders, calling their endurance through the long legal process a key achievement.
The remarks came as the long-running legal clash between Ripple and the SEC again draws market attention. Discussion is also likely to resume over how Ripple executives responded at the time, how the SEC brought its case and what impact the collective support of XRP holders had.