Crypto lawyer argues that SEC should not regulate digital assets, citing Hinman documents as evidence.

The highly anticipated Hinman documents have been released to the public, revealing why the United States Securities and Exchange Commission (SEC) may not be the best agency to oversee digital assets. The documents, which were made public on Tuesday, contained the past views of Bill Hinman, the former director of the corporate finance division at SEC. In a speech in 2018, Hinman stated that Ether (ETH) is not a security and shouldn’t be classified as such. The documents also detailed several communications within the agency that suggest the SEC’s view of the matter, both before and after the 2018 speech.

Crypto Lawyer Highlights the Significance of the Hinman Documents

John Deaton, a crypto lawyer and founder of CryptoLaw, shared his view of the newly released documents, stating that they may help Ripple, Coinbase, and others that have had a run-in with the SEC. However, he also claims that the documents may not prove helpful in court, as they do not take away the possibility that Ripple offered or sold XRP as an investment contract, nor does it take away XRP’s status in the secondary markets in the United States. Nonetheless, Deaton believes that the documents could help Ripple’s arguments in court, as Hinman’s speech caused market confusion and hindered certain market participants from fully understanding the existing regulations. Deaton also believes that the documents are likely to influence public opinion and ultimately shape legislative discussions in Congress, particularly when the public raises concerns about regulators’ conduct and interpretation of existing laws.

Finally, Deaton stated that the documents highlight the conflicts of interest and appearances of impropriety by William Hinman and Jay Clayton. Clayton was the previous chairman of the SEC who served from May 4, 2017, until December 23, 2020.

Regulatory Clarity Needed Now More than Ever

Reacting to the implications of the documents, Deaton believes that Congress needs to step in and provide clarity for the digital assets industry, as the SEC may not be the appropriate agency to oversee the crypto industry, considering the conflicts of interest and impropriety shown in the documents.