Bill Morgan, a legal expert popular among crypto circles online, recently stated that the support for the U.S. Securities and Exchange Commission (SEC) was fading away in terms of public perception and internal unanimity. The crypto lawyer’s comments were in connection with the recent settlement between the SEC and the web3 project Stoner Cats 2.
Morgan took to X (formerly Twitter) to share his thoughts on the settlement:
On September 13, 2023, the SEC charged Stoner Cats 2 LLC with conducting an unregistered crypto asset securities sale in the form of non-fungible tokens (NFTs). The securities regulator accused the web3 firm of raising $8 million from investors in order to fund an animated web series called Stoner. Stoner Cats 2 reached a settlement with the SEC after agreeing to a cease and desist order and paying a $1 million civil penalty.
Stuart Alderoty, the Chief Legal Officer (CLO) of American crypto giant Ripple, told his followers earlier today that the settlement would not serve as a legal precedent in any related matters. According to Alderoty, the case was a public relations (PR) stunt, and when seriously challenged, the SEC continued to lose in court.
Commenting on the implications of the SEC v Stoner Cats 2 settlement, the Ripple lawyer stated:
I don’t know all the facts here, but I do know that a settlement to avoid a crushing SEC process without “admitting or denying” anything is binding on no one.
Morgan responded to Alderoty’s comments and highlighted that the SEC’s apparent strategy of bullying defendants into “unjust settlements” similar to the one seen in Stoner Cats 2’s case, was facing criticism. The SEC’s own commissioners strongly disagreed with multiple enforcement actions and publicly dissented the same. The lawyer added, “The SEC is punishing not protecting investors for participating in a market it hates and is trying to destroy”.
