Pro-Ripple (XRP) attorney and Republican John Deaton shared a TikTok video on his X account, which featured American comedian Jon Stewart raising the alarm over the US Department of Defence’s “unmonitored” spending. Deaton quoted the video, saying it is why Elon Musk-led D.O.G.E. is “necessary.”
Stewart highlighted the disconnect between the Pentagon’s budget and the realities faced by service members. “We got out of 20 years of war, and the Pentagon got a raise,” Stewart remarked. “I can’t figure out how $850 billion to a department means that the rank and file still have to be on food stamps. To me, that’s f*cking corruption.”
Dragonchain attorney and pro-crypto Republican John Deaton quoted a TikTok video that included an interview on his X account, saying, “If you think Elon Musk and Vivek Ramaswamy’s D.O.G.E isn’t necessary, watch this.”
Deaton, who also supports XRP, seemingly suggested that the Department of Government Efficiency (D.O.G.E.) could bring much-needed accountability to departments like the Pentagon.
Legal tensions in the US SEC’s crypto cases
Deaton’s criticism extended to the ongoing legal conflict between the US Securities and Exchange Commission (SEC) and various crypto firms, including the case against Dragonchain. The SEC has accused Dragonchain of unregistered crypto asset security offerings, just like it had done to Ripple Labs and its token XRP.
In a recent court filing related to the SEC’s case, Deaton lashed out at the agency’s aggressive tactics, claiming that certain SEC lawyers continue to bully American entrepreneurs, especially those in the crypto sector.
“Certain lawyers at the SEC are continuing their bully tactics in non-fraud crypto cases against American entrepreneurs,” Deaton said on X. He added that Dragonchain, which originated from Disney, is “as American as it gets.”
Certain lawyers at the @SECGov are continuing their bullying tactics in non-fraud crypto cases against American entrepreneurs. @dragonchain originated out of Disney. You don’t get more American than that. @GaryGensler and his cronies won’t do what’s right, so we fight. https://t.co/LsOT5E8WXj
— John E Deaton (@JohnEDeaton1) December 21, 2024
The court filing also raised concerns about the SEC’s current approach to litigation, citing upcoming changes in leadership that could affect the agency’s strategy.
“There are fast-approaching changes to SEC leadership and enforcement priorities,” the filing read. “This case meets those criteria,” referencing an expected shift away from litigation that does not involve investor fraud or imminent harm.
Shifting SEC leadership
As Deaton and other legal experts continue to challenge the SEC’s enforcement strategies, the agency itself is undergoing a period of transition. The departure of SEC Chair Gary Gensler, who has been heavily involved in crypto-related enforcement, has sparked speculation about the future direction of the agency.
Gensler’s tenure has been marked by aggressive actions against cryptocurrency firms, including high-profile lawsuits against Ripple, Coinbase, and Binance.
John Reed Stark, former chief of the SEC’s Office of Internet Enforcement, criticized Gensler’s approach, suggesting that the financial authority’s leadership has become too entrenched in aggressive enforcement tactics. Stark noted the promotion of several senior enforcement officers who have been at the forefront of the agency’s crypto crackdown.
“SEC Chair Gary Gensler is clearly attempting to pilot the SEC Enforcement Division from the grave,” Stark remarked. “Since Donald Trump’s election, Gensler has promoted five Senior Officers within the SEC Enforcement Division at SEC Headquarters. Four of these SEC enforcement staff cut their teeth as SEC crypto-enforcement superstars.”
Stark speculated that the incoming leadership, expected to follow a pro-crypto agenda, could bring about significant changes in the way the agency handles crypto enforcement cases. However, he warned that seasoned enforcement staff might face challenges in adapting to new policies.
However, the incoming pro-crypto agenda under the regulator’s chair nominee Paul Atkins may signal a shift in how the agency handles such cases moving forward. Under this new leadership, the SEC could change its approach to enforcement, particularly in cases involving companies like Ripple, Coinbase, and others embroiled in similar legal battles.
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