In the latest clash of crypto heavyweights, Ripple CTO David Schwartz has refuted Cardano founder and IOG CEO Charles Hoskinson’s comments on the ongoing debate surrounding the alleged preferential treatment Ethereum received from the US Securities and Exchange Commission (SEC). The back-and-forth revolves around the so-called “ETH Gate” theory, which questions the SEC’s decision-making process regarding Ethereum’s regulatory status.

Ripple CTO And Cardano Founder Clash Over ETH Gate

Earlier this week, in an “asked me anything” (AMA), Charles Hoskinson (one of the eight former Ethereum founders) voiced his perspective on the topic, stating: “It’s certainly a value getting these Hinman emails and these other things because they can perhaps expose the thought process the SEC has and you can definitely show that there was unequal application of law. That’s fine. But none of that activity presupposes corruption, just favoritism.”

Hoskinson further differentiated between two emerging narratives in the crypto community. One suggests that Ethereum officials may have leveraged their networks or financial power to earn a more lenient stance from the SEC.

Meanwhile, a subset of XRP advocates believe Ethereum could have actively plotted against Ripple and its native currency, XRP. Highlighting the distinction, Hoskinson noted, “These are very different things. It is one thing to use relationships to protect your own thing. It is another thing to use relationships in a conspiracy to attack a competitor.”

In a sharp retort on the social platform X (previously known as Twitter), David Schwartz, Ripple’s CTO, countered:

I would argue that a government actor showing favoritism aligned with the personal interests of themselves and their friends is corruption.

This marks the first time a Ripple executive has directly labeled the “ETH Gate” situation as corruption. This stark stance contrasts with the more measured approach previously taken by Ripple execs. Prior to Schwartz, Ripple CLO Stuart Alderoty addressed the issue but wasn’t as direct.

In early August this year, Alderoty stated via X: “Crypto critic/x-SEC official John Reed Stark says there should be an investigation into Bill Hinman. This is broader than Ripple – there could potentially be serious conflicts of interest by a gov official. An investigation will either put it to rest or hold folks accountable.”

Back in June, following the public release of the Hinman emails, Alderoty emphasized the need to investigate the influences on Hinman’s decisions, the oversight of potential conflicts, and the SEC’s endorsement of the speech, which arguably added to market ambiguities.

ETH Gate Divides The Crypto Community

It has been well documented that William Hinman, former director of the SEC’s Division of Corporation Finance, consulted Ethereum co-founders Vitalik Buterin and Joseph Lubin prior to his pivotal speech. In this address, Hinman identified both ETH and BTC as non-securities, a move contrary to the advice of other senior SEC officials.

These revelations intensified speculations around Hinman’s potential financial motivations, especially considering his connections with Simpson Thacher, an active member of the Enterprise Ethereum Alliance (EEA). Reports have noted that Hinman accrued over $15 million from Simpson Thacher during his tenure with the SEC.

At press time, XRP traded at $0.4826.