• John Deaton, a pro-XRP lawyer and prominent figure behind Crypto Law, has publicly criticized the US Securities and Exchange Commission (SEC) for its lack of guidance on syndicated loans.
• Deaton referred to the SEC as a “broken institution” due to its refusal to provide a definitive opinion on whether such loans should be classified as securities.
• By not offering clear guidance, Deaton argues that the SEC has fostered an environment where it can potentially prosecute anyone or anything in the future.
John Deaton Criticizes SEC for Lack of Guidance
Attorney John Deaton , the prominent figure behind Crypto Law, has been consistently vocal in his criticism of the US Securities and Exchange Commission (SEC). As a pro-XRP lawyer, Deaton has raised concerns about the SEC’s failure to establish a transparent regulatory framework, particularly in its handling of the XRP case .
In a recent development, Deaton has slammed the SEC for its inability to provide a definitive opinion on whether syndicated loans are securities.
What are Syndicated Loans?
Syndicated loans, also known as syndicated bank facilities, are a form of financing where a group of lenders collaboratively provides funds to a single borrower. Such loans may involve a predetermined sum of money, a line of credit, or both.
SEC’s “Broken Institution”
In expressing his discontent with the SEC’s inaction on this matter, Deaton referred to it as a „broken institution“. He argued that by not offering clear guidance on whether syndicated loans should be categorized as securities or not – not only does it confuse market participants but it also hinders decision-making process for appellate courts.
Consequences Of Lack Of Clarity
Deaton believes that by refusing to offer clarity on this issue creates an environment where in theory – The SEC can potentially prosecute anyone or anything in the future without any real repercussions since there is no concrete definition regarding what constitutes security under such circumstances.
Advice To Market Participants
Given this lack of certainty from The SEC – Deaton advised market participants who engage with syndicated loan agreements exercise caution when doing so and seek legal advice before entering into any such agreement.