- Ripple CLO Stuart Alderoty criticized U.S. regulators for blaming cryptocurrencies for money laundering while overlooking failures in traditional financial systems.
- The XRP community strongly supports Alderoty’s stance, leading to a slight increase in XRP’s price amid ongoing legal battles.
On September 10, Ripple Labs’ Chief Legal Officer (CLO), Stuart Alderoty, strongly rebutted accusations that cryptocurrencies like Ripple’s XRP are enabling money laundering. Alderoty criticized U.S. regulators, particularly the Federal Reserve and the Securities and Exchange Commission (SEC), for unfairly targeting crypto while traditional financial systems have faced similar or worse issues.
Alderoty’s remarks were sparked by a Wall Street Journal report exposing the New York Federal Reserve’s failure to enforce crucial anti-money laundering measures. The report revealed that this lapse allowed hundreds of millions of dollars to be used to finance terrorist organizations in Iran over several years. In a sharp critique posted on X, Alderoty stated, “Some say money laundering is a crypto problem. Not true. Just ask the NY Federal Reserve, which let hundreds of millions of dollars slip through.”
Operation Choke Point 2.0 and Ripple’s Reaction
Alderoty’s comments resonate with broader frustrations within the crypto community, particularly regarding Operation Choke Point 2.0. This covert initiative allegedly pressures banks to cut ties with crypto companies, creating an unfair disadvantage for the industry by placing undue blame on it for broader financial system failures. Pro-XRP lawyer John Deaton and former White House Communications Director Anthony Scaramucci have both voiced similar concerns, arguing that banks and traditional financial institutions are also complicit in facilitating significant money laundering activities.
Deaton highlighted data from the United Nations Office on Drugs and Crime, which estimates that between $800 billion to $2 trillion is laundered annually through traditional financial systems. Banks such as HSBC and JPMorgan have been implicated in high-profile cases of money laundering.
XRP Community Rallies Behind Ripple’s CLO
The XRP community has rallied in support of Alderoty’s stance. Prominent figures, including Deaton, emphasize that cryptocurrencies, including XRP, account for only a small fraction of illicit transactions compared to traditional financial institutions. Ripple CEO Brad Garlinghouse also criticized the SEC’s aggressive stance against crypto, claiming it stifles innovation and progress in the sector.
XRP Price Movement Amidst Legal Battles
In the wake of these developments, XRP saw a modest price increase of nearly 3%, reaching $0.539 within the last 24 hours. While this uptick reflects increased trader interest, analysts caution against expecting a significant price surge in the near term, despite Ripple’s ongoing legal victories and advancements with the XRP Ledger.
As Ripple continues its fight against what it views as unjust allegations, the strong backing from the XRP community highlights the ongoing debate over crypto regulation and the broader implications for the industry.
About the Author
