Ripple CLO Denies Laundering Allegations, XRP Users react

Ripple CLO Denounces Laundering Allegations, XRP Community reacts

On September 10, Ripple Labs' Chief Legal Officer (CLO), Stuart Alderoty, voiced his concerns regarding accusations that cryptocurrencies, including Ripple’s XRP, are facilitating money laundering. Alderoty criticized U.S. regulators, particularly the U.S. Federal Reserve and the Securities and Exchange Commission (SEC), for focusing on crypto as a scapegoat while traditional financial systems have long been involved in similar or worse activities.

In a post on X, Alderoty referred to a Wall Street Journal report that revealed the New York Federal Reserve had failed to implement critical anti-money laundering safeguards. This oversight allowed hundreds of millions of dollars to finance terrorist organizations in Iran over several years. In response, Alderoty said, “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 the Ripple Effect

Alderoty’s comments align with growing frustrations within the crypto community about Operation Choke Point 2.0, a covert initiative targeting the crypto industry by pressuring banks to sever ties with crypto companies. Ripple, along with other major cryptocurrency organizations, believes that this initiative is unfairly damaging the industry by blaming crypto for systemic financial issues. Pro-XRP lawyer John Deaton and former White House Communications Director Anthony Scaramucci have echoed these concerns, pointing out that banks and traditional financial institutions are also responsible for facilitating money laundering on a massive scale.

John Deaton cited figures 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, with banks like HSBC and JPMorgan implicated in significant cases.

XRP Community Backs Ripple CLO

The XRP community, including prominent voices like Deaton, strongly supported Alderoty's stance. Many highlighted that cryptocurrencies, particularly Bitcoin and XRP, account for only a fraction of illicit transactions, while traditional financial institutions have been responsible for far greater volumes of illicit activities. Ripple CEO Brad Garlinghouse also weighed in, asserting that the U.S. government’s hostility towards crypto, particularly from the SEC, has stifled innovation and progress in the sector.

XRP Price Sees Modest Gain

Following these developments, XRP experienced a slight price increase of nearly 3%, reaching $0.539 within the last 24 hours. While the jump reflects growing interest from traders, analysts caution that a sudden surge in XRP’s value remains unlikely in the near term, despite Ripple’s ongoing legal victories and recent technical advancements with the XRP Ledger.

Ripple’s fight against unjust allegations continues, with strong backing from the XRP community as they await further developments in the battle for crypto regulation clarity.

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