Share this page!

John E Deaton (213K Followers Beware Imposters) Profile picture
Twitter logo
Sep 10 • 12 tweets • 10 min read
When I filed the motion to intervene in @SECGov 🆚 @Ripple on behalf of #XRPHolders, I used @Spend_The_Bits as a great example of why the Judge 👩‍⚖️ must allow us to be heard in the case.

@Jay_SpendDBits WITHOUT any help or 💰 from Ripple developed a payment app utilizing #XRPL.
#SpendTheBits will also be referenced in our Amicus Brief. According to Jay Kambo, @bgarlinghouse @chrislarsensf and @JoelKatz were completely unaware of who he was or of his idea to develop a payment app that allows you to spend your #Bitcoin JUST AS Satoshi Nakamoto envisioned.
That’s the beauty of the underlying technology. The #XRPLedger is an open permission-less distributed ledger technology - emphasis on “open and permission-less.”

Jay Kambo didn’t ask for permission - he just started building.
Jay looked at the Lightning ⚡️ Network and compared it to the #XRPLedger and decided that the #XRPL could be used as a better Layer 2 Solution to the #Bitcoin scaling, energy, and speed issues.

Why is the #SpendTheBits example so important to the case?
Because it DOESN’T MATTER if Jay Kambo is correct or dead wrong about SpendTheBits being a better solution.

Technologically speaking it is immaterial whether SpendTheBits is a great innovation or ultimately a waste of time. Personally, I’m not technically savvy enough to know.
But legally speaking it is absolutely one of the best examples to highlight the absolute absurdity regarding the SEC’s claims.

The SEC and @GaryGensler have conceded that #Bitcoin is a commodity. SpendTheBits allows you to spend your #BTC utilizing the #XRPL.
What that means is when you spend $100, $1K, or $1M of your #BTC using the #SpendTheBits app, it costs .00005 #XRP.

Thus, according to the SEC’s argument, the $100, $1K or $1M in #BTC is not a security but the .00005XRP is. 🤦‍♂️

See 👇👇
According to the SEC, that .00005XRP is an investment contract with Ripple - even if the @Spend_The_Bits customers in El Salvador 🇸🇻 or Canada 🇨🇦 have never heard of @Ripple @bgarlinghouse @chrislarsensf @JoelKatz or anyone else associated with Ripple.
According to the SEC’s argument, a SpendTheBits customer living in the United Kingdom 🇬🇧, or the UAE 🇦🇪, or Japan 🇯🇵, or Singapore 🇸🇬 or Australia 🇦🇺 or Switzerland 🇨🇭, using the app to spend their #BTC is using an unregistered security even though THEIR country says otherwise!
The SEC claims that the #XRP being LEGALLY used in Japan 🇯🇵, for example, is an investment contract w/ Ripple. They make that argument even though Ripple and its executives had nothing to do with Jay Kambo or SpendTheBits and the users in Japan are completely unaware of Ripple.
The SEC is arguing that the underlying #BTC being moved or spent on the @Spend_The_Bits App isn’t a security but the utility token #XRP that is being utilized to transfer or spend that #BTC is!

It’s insane.
That’s why I ✍️:

“The SEC complaint against Ripple and XRP, declaring that XRP was, always has been, and continues to be, a security is likely the most far-reaching, outrageous and absurd claim the SEC has ever alleged.”

🙏 to Jay and SpendTheBits for providing a great example.

• • •

Missing some Tweet in this thread? You can try to force a refresh
　

Keep Current with John E Deaton (213K Followers Beware Imposters)

John E Deaton (213K Followers Beware Imposters) Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @JohnEDeaton1

John E Deaton (213K Followers Beware Imposters) Profile picture
Sep 11
WILL THERE BE A SETTLEMENT IN @SECGov 🆚 @Ripple?

I’ve maintained for more than a year that settlement is 💯 dependent on whether the @SECGov must turn over the Hinman speech drafts, edits, emails and comments thereof.
Other than having to produce the emails and drafts, another event that could facilitate a settlement is if the SEC receives a disfavorable decision in the @LBRYcom case.

I’ve become more convinced that there will be no settlement unless one or both of those things happen.
First of all, my opinion regarding settlement is no better or more relevant than anyone else’s opinion. The fact that I’m amicus counsel places me in no better position to speculate than anyone else. I’m just sharing my observations b/c I’m receiving many emails and DMs asking.
Read 25 tweets
John E Deaton (213K Followers Beware Imposters) Profile picture
Sep 10
A year ago I was hesitant and careful to not accuse Hinman of actually breaking the law. Like @CGasparino and @EleanorTerrett, I gave him the benefit of the doubt, plus you shouldn’t impugn someone’s reputation unless you have clear irrefutable proof he/she violated the law. 👇
But see yourself👇Hinman was warned by SEC Ethics that he was BARRED by the financial criminal conflict statute from engaging in ANY contact w/his partners at Simpson Thacher. What everyone needs to understand is that this was a STRICT ABSOLUTE PROHIBITION
crypto-law.us/wp-content/upl…
What this meant was ABSOLUTELY NO CONTACT. No emails, phone calls, lunches or meetings where his law firm would be present.

The law makes it a crime for Hinman to have ANY contact whatsoever b/c if he creates “even an appearance of impropriety” it is a violation of the law. Image
Read 8 tweets
John E Deaton (213K Followers Beware Imposters) Profile picture
Sep 10
On January 1, 2021 - 9 days after the @SECGov sued @Ripple claiming ALL #XRP are securities including XRP sold independent of Ripple, I sued the SEC and argued the following:

“The issue before the Court and the public is that if the SEC actually attempts to incorporate [SEC’s]
public definitions and argue that today’s XRP is a security, it is a slippery slope that the SEC is going down. If the SEC does not amend its Complaint to only include alleging that specific XRP distributions, made by Ripple or its Executives, in the early days of Ripple and XRP,
then the entire Digital Asset Industry is on notice that the SEC could be coming for your Crypto next. This regulation by enforcement approach applied to Crypto, almost a decade later, must not be allowed by the Courts.”

-Deaton 🆚 @SECGov, Writ of Mandamus, January 1, 2021.
Read 4 tweets
John E Deaton (213K Followers Beware Imposters) Profile picture
Sep 8
@GaryGensler has the @Ripple #XRP case pending in the 2nd Circuit in SDNY, the @LBRYcom #LBC case in the 1st Circuit in N.H., and the @dragonchain #DRGN case in the 9th Circuit in Wa. He is now also suing individuals for selling 9 tokens as unregistered securities in Wahi case.
In the Ripple case the SEC has declared all #XRP, including #XRP traded in the secondary market independent of Ripple, securities. The token itself is a security per se.
In the LBRY case the SEC argued utility is irrelevant and even if 90% of the token holders acquired #LBC for non-investment use, if one person expected a profit all LBC are securities.
Read 4 tweets
John E Deaton (213K Followers Beware Imposters) Profile picture
Aug 18
Dear @VitalikButerin:

The more I think about your shameful and disgusting comment👇 and considering you haven’t deleted or clarified it, I realize you didn’t misspeak.

This was an immature hateful comment directed at a community of innocent digital asset holders and NOT @Ripple
Many people will not pay your comment much attention. But for those of us who’ve been exhaustingly fighting tribalism and believe in a multi-chain world of interoperability, your comments are truly demoralizing.
If you would’ve said Ripple lost its right to protection, I wouldn’t comment, whether I agree w/it or not. Ripple can defend itself. But even quite possibly Ripple’s biggest critic, @twobitidiot, has recognized the SEC’s overreach and has stated he hopes Ripple defeats the SEC.
Read 18 tweets
John E Deaton (213K Followers Beware Imposters) Profile picture
Aug 5
A SYNOPSIS OF THE @SECGov 🆚 @LBRYcom SUMMARY JUDGMENT TRANSCRIPT.

As I said during @CryptoLawUS’s livestream after watching the SEC 🆚 LBRY Summary Judgment argument below is my single biggest criticism and observation along with direct quotes from the hearing.
The Judge 👨‍⚖️ asked the SEC’s lawyer:

“Do you concede that there is what I think LBRY is calling a consumptive use for #LBC?”

SEC Lawyer:

“We do, your honor. Not for the entire time of the offering.”
The COURT:

“When does something that has a consumptive use and that LBRY would say is a commodity shade into a security?”

SEC Lawyer:

“Well, your Honor, I first would say you don’t start with the presumption that something is a commodity. You apply the Howey test first.”
Read 25 tweets

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Don't want to be a Premium member but still want to support us?

Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal

Or Donate anonymously using crypto!

Ethereum

0xfe58350B80634f60Fa6Dc149a72b4DFbc17D341E copy

Bitcoin

3ATGMxNzCUFzxpMCHL5sWSt4DVtS8UqXpi copy

Thank you for your support!

Follow Us on Twitter!

:(