Inspector General’s investigation into possible crypto conflicts of interest

The SEC’s decision on whether to appeal could depend on an ongoing investigation into possible crypto conflicts of interest within the agency.

In February 2024, Empower Oversight announced that an investigation by the Office of Inspector General (OIG) was in its final stages. The investigation focuses on former SEC Director William Hinman, a key figure in the Ripple case.

Empower Oversight referred the conflicts of interest to the OIG, claiming that SEC officials were biased against XRP and Ripple Labs. In 2018, Hinman said Bitcoin (BTC) and Ethereum (ETH) were not securities, which impacted XRP. In addition,

Empower Oversight alleged that Hinman received millions of dollars from his former employer, the law firm Simpson Thacher, while working at the SEC. After leaving the SEC, Hinman returned to Simpson Thacher.

Significantly, Simpson Thacher was part of a group that promoted Enterprise Ethereum.

SEC documents produced in the Ripple case showed that Hinman continued to meet with Simpson Thacher employees despite warnings from the SEC’s Ethics Division.

If the OIG finds evidence of misconduct or conflicts of interest, the SEC could decide to terminate all appeal plans. The agency’s six attempts to withhold Hinman-related documents underscore the sensitivity of the matter.

XRP Price Trends

XRP could move towards the July 2023 high of $0.9327 if the OIG findings impact the SEC’s appeal plans. Conversely, if the SEC appeals, XRP could drop to $0.40, leaving XRP in limbo.