WEBVTT - Game Changing Decision for Crypto

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<v Speaker 1>This is Bloomberg Law with June Brusso from Bloomberg Radio.

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<v Speaker 2>A game changing appellate court win for the crypto industry

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<v Speaker 2>and a stinging defeat for the SEC. The DC Circuit

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<v Speaker 2>Court of Appeals overturned the SEC's decision to block Grayscale

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<v Speaker 2>Investments proposed spot bitcoin exchange traded fund. Grayscale's CEO, Michael Sunenshein,

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<v Speaker 2>called it a huge victory for the crypto industry.

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<v Speaker 1>A panel of three judges unanimously voted and agreed with Greyscale,

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<v Speaker 1>and that actually vacates the SEC denial order. Huge win

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<v Speaker 1>for Greyscale, huge win for our investors, and really the

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<v Speaker 1>crypto and investment community is as a whole.

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<v Speaker 2>But the decision doesn't mean that Greyscale can launch its

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<v Speaker 2>bitcoin ETF. It's still a long road ahead. The SEC

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<v Speaker 2>will likely appeal the decision and it may even reject

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<v Speaker 2>the ETF applications of Grayscale and other companies with a

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<v Speaker 2>different justification. My guest is Anthony Sabino, a professor of

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<v Speaker 2>law at Saint John's University's Tobin College of Business and

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<v Speaker 2>a partner at Sabino and Sabino. Anthony, is this a

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<v Speaker 2>landmark victory for the crypto industry.

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<v Speaker 3>It is definitely a landmark in the sense that it

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<v Speaker 3>now shows a clear path for future crypto products to

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<v Speaker 3>be registered for trading on the exchange, But in a

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<v Speaker 3>legal sense, it's really not all that earth shattering June

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<v Speaker 3>for the simple reason that the d C Circuit's opinion

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<v Speaker 3>in terms of the legal basis was fairly narrow. The

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<v Speaker 3>essence of it is that the DC Circuit stated that

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<v Speaker 3>the SEC, in denying Grayscale Investments proposed ETP exchange traded

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<v Speaker 3>product of Bitcoin, the SEC was arbitrary and capricious and

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<v Speaker 3>abused its discretion. That's the legal standard for agency action.

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<v Speaker 3>Agencies must make their decisions, regulatory decisions on a reasoned,

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<v Speaker 3>rational and well informed basis, and the DC Circuit basically said, no,

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<v Speaker 3>you did not. And the reason why they found it arbitrary, capricious,

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<v Speaker 3>abuse discretion again those the words of the last one

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<v Speaker 3>hundred years, was the fact that within the last year

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<v Speaker 3>or so, the Commission had approved similar products, and those

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<v Speaker 3>being exchange traded products ETPs for bitcoin futures, and the

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<v Speaker 3>DC Circuit and a very thoughtful, very extensive opinion laid

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<v Speaker 3>out in great detail how there was extraordinary similarities between

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<v Speaker 3>the markets for bitcoin futures, and while distinct from bitcoin

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<v Speaker 3>per se, on the spot market, there are many many similarities.

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<v Speaker 3>So bottom line is this, says the DC Circuit SEC.

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<v Speaker 3>You approved two of the bitcoin futures products to be

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<v Speaker 3>traded on various exchanges, but you said no to grey

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<v Speaker 3>scales spot market bitcoin product, and that's arbitrary, capricious, abuse discretion,

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<v Speaker 3>and that's how we got to this decision.

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<v Speaker 2>Critics have said that SEC Chair Gary Gensler has overstepped

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<v Speaker 2>in his attempt to clamp down on the crypto industry.

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<v Speaker 2>Is the Court saying that too in this decision?

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<v Speaker 3>No, not really, And I'll address in a moment the

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<v Speaker 3>critics of Chairman Gensler, But in truth, it is a

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<v Speaker 3>criticism that can't be denied. That's obvious, and they are

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<v Speaker 3>folding the Commission for in this instance making a decision

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<v Speaker 3>that was again arbitrary, capricious in essence, you did not

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<v Speaker 3>treat similar products. And again, June, those are the precise

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<v Speaker 3>words of the opinion, which is a wonderful read, by

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<v Speaker 3>the way, for this audience. Because the DC Circuit Circuit

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<v Speaker 3>Judge Naomi Raoul took the time to really explain to

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<v Speaker 3>both expert and neophytal, like what bitcoin is all about,

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<v Speaker 3>how it works, the difference between Bitcoin spot market bitcoin futures.

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<v Speaker 3>But once again, the essence of the opinion was to say, look, okay,

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<v Speaker 3>you took the bitcoin futures products from two other aftlets.

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<v Speaker 3>I think one it's called Valkyrie and Creesium. I apologize

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<v Speaker 3>mispronouncing that, and you'll prove that. But the similarities are

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<v Speaker 3>so much so, especially with respect to preventive measures to

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<v Speaker 3>prevent against fraud and market manipulation, that basically it's again

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<v Speaker 3>the circuit's words, were similar products. So if you approved

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<v Speaker 3>two products that were similar, then you have to approve

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<v Speaker 3>the third one, which is the great product. With respect

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<v Speaker 3>to criticism and mist a cancer, Look that's been going

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<v Speaker 3>on and it has to go on. It should go

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<v Speaker 3>on for the simple reason that he is an appointee

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<v Speaker 3>of the administration. He must be accountable to the American people.

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<v Speaker 3>He's an unelected person and again a person of great credentials,

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<v Speaker 3>great reputation, etc. The bottom line, the market has a

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<v Speaker 3>right to criticize, but the court here I do not

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<v Speaker 3>view in any ways criticizing Chairman Againstler's particular tactics or

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<v Speaker 3>policies in this regard, so he'll keep going on doing

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<v Speaker 3>what he's doing. But once again, to sort of fairly

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<v Speaker 3>exposit with both sides, the crypto market is of course

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<v Speaker 3>going to be critical because they're like, look, it's crypto,

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<v Speaker 3>we know what we're doing. Leave us alone. That's fine

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<v Speaker 3>to an extent, But again some people used to say

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<v Speaker 3>that in nineteen twenty seven, ninety twenty eight, and that's

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<v Speaker 3>how you have the un regulated market in the Creation

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<v Speaker 3>twenty nine. On the other hand, we do live in

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<v Speaker 3>a free enterprise, free market, and therefore or there has

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<v Speaker 3>to be a point where the regulators have to sort

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<v Speaker 3>of step back and say, all right, let the market function,

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<v Speaker 3>let the market weed things out, and let's experiment. And

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<v Speaker 3>I also think that's where we have to make the

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<v Speaker 3>point that regulatory authority is strictly cabined by the statutory

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<v Speaker 3>authority that Congress gives it. And in an indirect way. Okay,

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<v Speaker 3>And again the d C Circuit really not criticizing, but

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<v Speaker 3>by using the legal standard and also calling upon the

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<v Speaker 3>statute which regulates the sec process June for how new

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<v Speaker 3>products come to market and how they were approved by

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<v Speaker 3>a rule change, et cetera. Basically, the DC Circuit is saying, look,

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<v Speaker 3>there's rules, there are statutes, they were made by Congress,

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<v Speaker 3>and now SEC you have to follow them. Oh, when

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<v Speaker 3>in this instance you did not follow the rule, your

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<v Speaker 3>actions were here we go again aubitrary, capricious abuse of

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<v Speaker 3>discretion because essentially you didn't follow the statute, you were

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<v Speaker 3>inconsistent in your results on these substantially SMaL products, so

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<v Speaker 3>on and so forth.

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<v Speaker 2>The SEC has forty five days to appeal the ruling.

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<v Speaker 2>An agency spokesperson said it was reviewing the Court's decision

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<v Speaker 2>in order to determine next steps.

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<v Speaker 3>Right it could ask.

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<v Speaker 2>For their on bank hearing before the full DC Circuit

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<v Speaker 2>or petition the Supreme Court. Does the SEC almost have

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<v Speaker 2>to appeal this?

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<v Speaker 3>I would say yes. I would say yes for a

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<v Speaker 3>number of reasons. Okay, an appeal is a foregone conclusion.

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<v Speaker 3>Although I would say, as you've articulated the steps so correctly,

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<v Speaker 3>is that they'll do for an en bank. In other words,

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<v Speaker 3>there's the entire DC Circuit to hear this, of some

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<v Speaker 3>fifteen or so judges as opposed to these three. And

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<v Speaker 3>by the way, this is kind of a powerhouse panel

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<v Speaker 3>here because Judge raw was very well known. One of

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<v Speaker 3>the other judges there was Harry Edwards, a senior Circuit

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<v Speaker 3>judge from decades ago, and the chief judge of the

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<v Speaker 3>DC Circuit, which is Judge Trinavasan who you may remember

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<v Speaker 3>only a few years ago was on the short list

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<v Speaker 3>of mister Obama to be the next nominee to the

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<v Speaker 3>US Supreme Court. So that's kind of a you know,

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<v Speaker 3>a well credentialed supercharged panel. But that's only the three.

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<v Speaker 3>So they're going to ask for non bank hearing and

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<v Speaker 3>then whoever wins or loses, and that is probably going

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<v Speaker 3>to appeal to the US Supreme Court. One of the

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<v Speaker 3>reasons why I'm so convinced that there will be an

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<v Speaker 3>appeal is number one, it's the government and as we

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<v Speaker 3>will and as your audience knows well, the government appeals

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<v Speaker 3>every averge decision because heck, they're funded by our at

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<v Speaker 3>tax payer dollars, all right. And secondly, the government hates

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<v Speaker 3>to lose, all right. And the SEC has had a

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<v Speaker 3>few setbacks in recent years. Right now, there's the Arcas

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<v Speaker 3>case Penny with respect to the power of removal of

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<v Speaker 3>SEC administrative law judges five years ago they lost Fluccia

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<v Speaker 3>case that SEC admin law judges have to be appointed

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<v Speaker 3>by the President and so forth. So the SEC. You know,

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<v Speaker 3>they had a few wins, but they've had a few

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<v Speaker 3>losses here as well, so darn right they're not going

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<v Speaker 3>to take this sitting down. And also, in essence right now, June,

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<v Speaker 3>they've taken a black guy because it's not fun for

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<v Speaker 3>them to have the DC Circuit, which hears many, many

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<v Speaker 3>of these cases when it comes to federal regulations and

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<v Speaker 3>challenges there too. They're really the locust of all dis litigation.

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<v Speaker 3>So when the DC Circuit says, hey, Sec, you are arbitrary,

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<v Speaker 3>you're capricious, you abuse your discretion, they don't like that,

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<v Speaker 3>so they want to get that flipped around. I will

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<v Speaker 3>say this, though, while I am convinced that an appeal

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<v Speaker 3>shall be had by whatever means, the bottom line is

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<v Speaker 3>what are the chances of prevailing? That's a pretty good

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<v Speaker 3>question too, And if you don't mind, I'll answer it

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<v Speaker 3>by saying that's gonna be tough because basically, when you

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<v Speaker 3>have a decision that says the agency acted in an arbitrary,

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<v Speaker 3>capricious matter, that's very fact intensive and as we all

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<v Speaker 3>well know, the Supreme Court does not engage in fact finding.

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<v Speaker 3>They take the record as is, and the DC Circuit,

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<v Speaker 3>and again kudos to Circuit Judge Rau. There's a very

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<v Speaker 3>extensive factual record here, built upon the Commission's own record,

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<v Speaker 3>But there is extensive fact finding here where the DC Circuit,

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<v Speaker 3>in the Greyscale decision, explains point for points why the

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<v Speaker 3>Commission's decision was arbitrary and capricious.

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<v Speaker 2>What kind of guide posts did this decision leave that

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<v Speaker 2>might be helpful to other crypto firms?

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<v Speaker 3>And again that's the interesting point the Circuit Court. The

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<v Speaker 3>DC Circuit says, Okay, the SEC was arbitrary and capricious,

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<v Speaker 3>did not provide a rational basis for its decision, going

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<v Speaker 3>to make the same mistake, We're going to explain to you,

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<v Speaker 3>point by point, in detail why we found their actions

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<v Speaker 3>to be without a proper factual basis. And having put

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<v Speaker 3>that forth, Okay, they'll appeal to the Supreme Court eventually,

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<v Speaker 3>the SEC. But the Court may very well not decide

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<v Speaker 3>this case because once again we come back to the

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<v Speaker 3>fact June that it was decided on a very narrow

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<v Speaker 3>legal ground. There's no new legal ground to be broken. Here. Although,

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<v Speaker 3>as you said at the outset, and I agree completely,

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<v Speaker 3>this is a very game changing decision for the crypto

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<v Speaker 3>industry as a whole because in many respects it provides

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<v Speaker 3>a roadmap for other funds and a path for various

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<v Speaker 3>firms to create investment vehicles in crypto, because all they

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<v Speaker 3>really have to do is read the DC Circuit's opinion

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<v Speaker 3>and say, oh, okay, this is how Greyscale did it.

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<v Speaker 3>So guess what inimitation is the sincerest form of flattery,

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<v Speaker 3>So they got it right before the DC Circuit. Whatever

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<v Speaker 3>they did will do. And especially I think what's important

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<v Speaker 3>is the DC Circuit made much of the fact that

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<v Speaker 3>one of the reasons why the SEC the decision was

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<v Speaker 3>arbitrary was they basically pooh poohed the fact they overlooked

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<v Speaker 3>the fact that there is more than adequate surveillance to

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<v Speaker 3>protect more in integrity. So again I'm not giving any

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<v Speaker 3>advice to crypto fund managers, but read that opinion for

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<v Speaker 3>yourself and you'll see how important it is to demonstrate

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<v Speaker 3>that whatever your proposed product is going to be, you

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<v Speaker 3>have to show that there are safeguards, guardrails and so

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<v Speaker 3>forth to prevent FUDAM manipulation, and that your product is

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<v Speaker 3>tied to market surveillance such as that conducted by the CMME,

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<v Speaker 3>the Chicago Mercancy Exchange. That way, in the event of

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<v Speaker 3>manipulation or fraud, it can be detected and rooted out.

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<v Speaker 3>That was a very important guidepost, if you will, that

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<v Speaker 3>the DC Circuit set out of his opinion and words

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<v Speaker 3>that the crypto industry must take very very seriously and

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<v Speaker 3>follow to.

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<v Speaker 2>The letter Anthony. This doesn't mean that the Grayscale ETF

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<v Speaker 2>is automatically approved, does it.

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<v Speaker 3>No, not at all. Okay, what it means is the

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<v Speaker 3>Commission's decision is overturned as orbitr and capricious, but Greyscale

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<v Speaker 3>has to go back and again. As I understanding the process,

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<v Speaker 3>essentially they have to come back and again reapply something

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<v Speaker 3>along those lines. So in essence, the DC Circuit says

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<v Speaker 3>the Commission was wrong to say no to you. But now,

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<v Speaker 3>basically I would think the process would start afresh or

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<v Speaker 3>close to a fresh start, and then it has to

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<v Speaker 3>get approved. So they have to get approved, So it's

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<v Speaker 3>not a done deal, and thank you. That's an excellent point.

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<v Speaker 3>And I concurt completely is that it's not over by

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<v Speaker 3>any means, and the SEC may find other grounds to object.

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<v Speaker 3>I may say, okay, we would called arbitrary caprecients this time.

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<v Speaker 3>But now let's really dig in and tell a future

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<v Speaker 3>court of review, which would probably be the DC Circuit. Again,

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<v Speaker 3>this is why we said no. If indeed they say no.

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<v Speaker 3>But you know, Gray Scales got plenty of work to do,

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<v Speaker 3>so they're not there yet, but they're a big step

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<v Speaker 3>closer to getting that ETP out there.

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<v Speaker 2>ETF right.

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<v Speaker 3>Well, you know that's interesting because we call them ETFs

0:11:45.320 --> 0:11:47.600
<v Speaker 3>and that's correct, but the court, by the way, calls

0:11:47.640 --> 0:11:50.360
<v Speaker 3>them ETPs exchange trade of product. And you know what

0:11:50.400 --> 0:11:52.800
<v Speaker 3>you say, potato, I say, Patato. I think it's really

0:11:52.840 --> 0:11:54.480
<v Speaker 3>the same thing. But you know what, when the DC

0:11:54.640 --> 0:11:57.800
<v Speaker 3>Circuit speaks, I clam up. And what they say.

0:11:58.240 --> 0:12:01.520
<v Speaker 2>The SEC is already fired out a lower court ruling

0:12:01.640 --> 0:12:05.600
<v Speaker 2>over sales of ripples it's RP token, but it's still

0:12:05.640 --> 0:12:09.800
<v Speaker 2>moving ahead with a series of high profile enforcement actions,

0:12:09.920 --> 0:12:13.720
<v Speaker 2>including against Coinbase Global and Binance Holdings. Do you think

0:12:13.760 --> 0:12:15.880
<v Speaker 2>the SEC should take a pause? Maybe?

0:12:16.520 --> 0:12:20.080
<v Speaker 3>Well, you know what, in all honesty, no, okay, because

0:12:20.240 --> 0:12:23.080
<v Speaker 3>that's their job, that's their portfolio. They've been charged with

0:12:23.480 --> 0:12:28.000
<v Speaker 3>enforcement securities law, protecting investors and maintaining more in integrity.

0:12:28.160 --> 0:12:30.720
<v Speaker 3>So I think they should go forward the Ripple case. Certainly,

0:12:30.760 --> 0:12:33.920
<v Speaker 3>again we have that decision from the southernst of New York.

0:12:33.960 --> 0:12:36.760
<v Speaker 3>I think that was Judge Analice Torres, and again she

0:12:36.960 --> 0:12:39.319
<v Speaker 3>decided that. And we have to remember, and I haven't

0:12:39.320 --> 0:12:42.880
<v Speaker 3>digested completely, it's a big decision, but as we know,

0:12:43.200 --> 0:12:46.480
<v Speaker 3>in essence, the court said, look, some aspects of bitcoin

0:12:46.880 --> 0:12:49.800
<v Speaker 3>are commodities, and the SEC has no jurisdiction to kick

0:12:49.800 --> 0:12:53.640
<v Speaker 3>it over the CFTC. But other things do qualify as securities,

0:12:53.679 --> 0:12:56.679
<v Speaker 3>and therefore the SEC can regulate them, etc. But of

0:12:56.679 --> 0:12:59.520
<v Speaker 3>course Ripple is going to be appealed, and that probably

0:12:59.520 --> 0:13:00.959
<v Speaker 3>will get all the way up to the Spring Cord,

0:13:01.000 --> 0:13:03.520
<v Speaker 3>I would think, because it's such an important issue, not

0:13:03.600 --> 0:13:05.120
<v Speaker 3>just in terms of the law, but in terms of

0:13:05.160 --> 0:13:07.840
<v Speaker 3>the future of the American financial markets. So that's let's

0:13:07.840 --> 0:13:11.040
<v Speaker 3>call it unsettled at this time. With the other actions, again,

0:13:11.240 --> 0:13:14.160
<v Speaker 3>they're very different. The nances, I remember we talked about

0:13:14.160 --> 0:13:16.040
<v Speaker 3>this quite a while ago, and they are a host

0:13:16.040 --> 0:13:18.360
<v Speaker 3>of charges there. That's the one, if I recall, is

0:13:18.400 --> 0:13:21.080
<v Speaker 3>where they've been charged with not registering. Is the fund

0:13:21.240 --> 0:13:24.920
<v Speaker 3>that's really, really serious. So this is important work that

0:13:24.960 --> 0:13:27.360
<v Speaker 3>the Commission has to do. So I don't think they

0:13:27.400 --> 0:13:30.960
<v Speaker 3>should pause, but they should take the weekend, if you will,

0:13:31.240 --> 0:13:34.040
<v Speaker 3>to sit back, reflect and say, Okay, what's the strategy here?

0:13:34.080 --> 0:13:36.520
<v Speaker 3>Because you've got a lot of different pieces. They're fighting

0:13:36.600 --> 0:13:39.920
<v Speaker 3>a lot of different battles on different fronts, and I

0:13:40.000 --> 0:13:43.720
<v Speaker 3>think there is to an extent an overall strategy. But

0:13:43.800 --> 0:13:46.120
<v Speaker 3>I think Chairman Gensler owes it to himself and more

0:13:46.160 --> 0:13:48.640
<v Speaker 3>importantly to the American people and to the financial markets,

0:13:48.760 --> 0:13:51.760
<v Speaker 3>to say, let's have a comprehensive strategy here. To whatever

0:13:51.800 --> 0:13:56.400
<v Speaker 3>extent the rippled decision was adverse to the Commission, the

0:13:56.440 --> 0:13:58.960
<v Speaker 3>SEC has to learn from that and say, okay, we've

0:13:59.040 --> 0:14:00.880
<v Speaker 3>lost this, and again they're going to appel it. But

0:14:01.040 --> 0:14:03.320
<v Speaker 3>as things stand today, June I would say they need

0:14:03.360 --> 0:14:06.360
<v Speaker 3>to reflect upon that and take a step back and say, okay,

0:14:06.679 --> 0:14:09.760
<v Speaker 3>how do we modify a strategy from here? And once again,

0:14:10.000 --> 0:14:12.440
<v Speaker 3>there is still at the very heart of this, okay,

0:14:12.600 --> 0:14:15.240
<v Speaker 3>that the eye of the storm is that fundamental issue

0:14:15.440 --> 0:14:18.520
<v Speaker 3>when it comes to investing in bitcoin. Are you buying

0:14:18.679 --> 0:14:21.120
<v Speaker 3>a commodity which kicks it over to the CFTC and

0:14:21.120 --> 0:14:24.440
<v Speaker 3>the commodity's laws, or are you buying a security which

0:14:24.480 --> 0:14:27.760
<v Speaker 3>is purely the SEC's bailiwick and under the federal securities laws.

0:14:27.760 --> 0:14:31.320
<v Speaker 3>And that's the key distinction. And because of the newness

0:14:31.320 --> 0:14:35.160
<v Speaker 3>of crypto, because of its its flexible nature, we're really

0:14:35.200 --> 0:14:37.280
<v Speaker 3>not sure about all that, and I certainly don't want

0:14:37.280 --> 0:14:39.880
<v Speaker 3>the SEC to back off. But at the same time,

0:14:40.160 --> 0:14:43.000
<v Speaker 3>the bitcoin industry, the crypto industry, has every right to

0:14:43.040 --> 0:14:47.320
<v Speaker 3>continue to innovate, to make progress, move forward what they're doing.

0:14:47.800 --> 0:14:50.680
<v Speaker 3>But again within this the regulatory framework that's there, so

0:14:50.840 --> 0:14:53.680
<v Speaker 3>again many many unresolved issues, but I really think it

0:14:53.680 --> 0:14:57.280
<v Speaker 3>depends upon the industry itself. It can, and it should,

0:14:57.320 --> 0:15:01.480
<v Speaker 3>and it must innovate. And then as it innovates, we see, Okay,

0:15:01.600 --> 0:15:03.960
<v Speaker 3>are you selling a commodity, you're selling in security and

0:15:04.000 --> 0:15:06.760
<v Speaker 3>if so, have you complied with regulatory framework pertinent to

0:15:06.800 --> 0:15:08.280
<v Speaker 3>each And also.

0:15:08.360 --> 0:15:11.480
<v Speaker 2>Judge Raykoff came down with a different take on it

0:15:11.560 --> 0:15:13.920
<v Speaker 2>than Judge Toures, right.

0:15:13.920 --> 0:15:16.520
<v Speaker 3>Right, And you know that's again one of the interesting facets,

0:15:16.840 --> 0:15:19.240
<v Speaker 3>as you're learned, audience, I'm sure knows, is that here

0:15:19.240 --> 0:15:21.720
<v Speaker 3>you have two very prominent judges in the Southern Dutch

0:15:21.800 --> 0:15:23.880
<v Speaker 3>of New York, which really is, you know, with two

0:15:23.920 --> 0:15:26.440
<v Speaker 3>subway stops from Wall Street, and also is the primary

0:15:26.440 --> 0:15:28.120
<v Speaker 3>court for Wall Street type disputes to go to in

0:15:28.120 --> 0:15:31.280
<v Speaker 3>the first instance. And of course Jed Raykoff is absolutely

0:15:31.320 --> 0:15:33.880
<v Speaker 3>a living legend when it comes to federal securities law.

0:15:33.960 --> 0:15:35.760
<v Speaker 3>But what it demonstrates is that you can have two

0:15:35.840 --> 0:15:39.240
<v Speaker 3>judges of equal rank in the same district and disagree,

0:15:39.360 --> 0:15:41.240
<v Speaker 3>and they're allowed to do that. And there's about another

0:15:41.280 --> 0:15:44.440
<v Speaker 3>twenty five judges in Southern District and they could also

0:15:44.560 --> 0:15:47.400
<v Speaker 3>all disagree. That's why the real key is going to be,

0:15:47.480 --> 0:15:50.240
<v Speaker 3>let's see what happens when Ripple and the Raykoff decision

0:15:50.280 --> 0:15:52.560
<v Speaker 3>I don't recall which case it was, goes up to

0:15:52.600 --> 0:15:56.720
<v Speaker 3>the Second Circuit because they're there to conciliate these and

0:15:56.760 --> 0:15:59.080
<v Speaker 3>to reconcile one decisions to the other. And then they

0:15:59.120 --> 0:16:02.000
<v Speaker 3>get the next to last word. And why say next

0:16:02.000 --> 0:16:04.040
<v Speaker 3>to last word is because they could still go to

0:16:04.080 --> 0:16:06.480
<v Speaker 3>the U. Supreme Court. But let's also keep in mind,

0:16:06.560 --> 0:16:10.520
<v Speaker 3>as the Supreme Court itself said decades ago, they regard

0:16:10.560 --> 0:16:13.920
<v Speaker 3>the Second Circuit as the quote mother court close quote

0:16:14.120 --> 0:16:16.760
<v Speaker 3>of the federal securities laws. They are very deferential to

0:16:16.760 --> 0:16:19.400
<v Speaker 3>what the second Circuit says, so the battle or the

0:16:19.440 --> 0:16:22.560
<v Speaker 3>controversy is far from over June. This is just one

0:16:22.560 --> 0:16:24.640
<v Speaker 3>of many battles, and we have to see what the

0:16:24.680 --> 0:16:27.640
<v Speaker 3>second circuit says about Ripple and these related cases in

0:16:27.760 --> 0:16:30.200
<v Speaker 3>the years to come. And also as we have new

0:16:30.240 --> 0:16:35.000
<v Speaker 3>permutations and innovations by the industry, once again, okay, where

0:16:35.000 --> 0:16:37.360
<v Speaker 3>do they fall in the market, which regulatory framework would

0:16:37.360 --> 0:16:40.840
<v Speaker 3>they fall within? Etc. So I think really bottom line

0:16:41.200 --> 0:16:43.920
<v Speaker 3>is that everybody's going to go great guns. Crypto is

0:16:43.960 --> 0:16:46.440
<v Speaker 3>on a roll. It's not going to stop. Okay. Gary

0:16:46.440 --> 0:16:49.400
<v Speaker 3>Ginstler wants to make sure his agency is regulating this,

0:16:49.840 --> 0:16:53.200
<v Speaker 3>and that's consistent with his personal behavior because he regulated

0:16:53.200 --> 0:16:55.160
<v Speaker 3>it is the head of the CFTC not too long ago.

0:16:55.360 --> 0:16:58.240
<v Speaker 3>And the CFTC says, wait a minute, okay, Bitcoin, that's

0:16:58.240 --> 0:17:00.840
<v Speaker 3>a commodity. It's like, you know, the kind of future.

0:17:01.160 --> 0:17:03.440
<v Speaker 3>It's like oil and gas and pork bellies and what

0:17:03.520 --> 0:17:05.840
<v Speaker 3>have you. So guess what we want to regulate it too.

0:17:05.880 --> 0:17:08.200
<v Speaker 3>So a lot of action, a lot of controversy in

0:17:08.240 --> 0:17:10.920
<v Speaker 3>the years to come. This is just one stop, Okay.

0:17:10.960 --> 0:17:13.280
<v Speaker 3>My advice is everybody have a good Labor Day weekend

0:17:13.440 --> 0:17:15.320
<v Speaker 3>because the battle's going to start as soon as we

0:17:15.359 --> 0:17:15.760
<v Speaker 3>get back.

0:17:16.160 --> 0:17:19.960
<v Speaker 2>Okay, thanks so much. That's Professor Anthony Sabino of Saint

0:17:20.040 --> 0:17:23.920
<v Speaker 2>John's University's Tobin College of Business. And that's it for

0:17:23.960 --> 0:17:26.600
<v Speaker 2>this edition of The Bloomberg Law Show. Remember you can

0:17:26.640 --> 0:17:29.879
<v Speaker 2>always get the latest legal news on our Bloomberg Law Podcast.

0:17:30.160 --> 0:17:33.160
<v Speaker 2>You can find them on Apple Podcasts, Spotify, and at

0:17:33.320 --> 0:17:38.359
<v Speaker 2>www dot bloomberg dot com slash podcast Slash Law, and

0:17:38.440 --> 0:17:41.520
<v Speaker 2>remember to tune into The Bloomberg Law Show every weeknight

0:17:41.600 --> 0:17:45.040
<v Speaker 2>at ten pm Wall Street Time. I'm Junie Grosso and

0:17:45.080 --> 0:17:46.560
<v Speaker 2>you're listening to Bloomberg