David Schwartz Reveals Those Likely Behind SEC Lawsuit Against Ripple and XRP

The allegations at the center of ETHGate have circulated for years. The theory holds that the SEC gave Ethereum preferential regulatory treatment while pursuing aggressive enforcement against XRP and other competing crypto projects. Now, one of the most credible voices in the XRP ecosystem has shared his view, and it is more measured than many expected.

David Schwartz, Ripple’s CTO Emeritus, addressed ETHGate directly in a post that has drawn significant attention.

I don't have good evidence for this, but I think it's more likely that competing crypto projects had more to do with it. I'm not really sure why I think that, so feel free to disagree.

— David 'JoelKatz' Schwartz (@JoelKatz) July 12, 2026

What Schwartz Said

Responding to a question about whether a “Central Banking Cartel” deliberately tried to destroy the crypto industry to protect its monopoly, Schwartz was candid about the limits of his knowledge. He said he lacked good evidence for that theory.

He offered an alternative view, suggesting that competing crypto projects are likely behind the SEC’s enforcement action. He acknowledged uncertainty about his own reasoning and invited disagreement.

He then addressed ETHGate specifically when pressed further. Again, he was clear about what he does and does not know. “I don’t have good evidence for this, but I do feel it is more real than fake.”

The Context Around His Comments

The conversation began with a post from UnknowDLT referencing Ripple CEO Brad Garlinghouse’s account of how close the company came to shutting down during the SEC lawsuit. The thread evolved into a broader discussion about what motivated the SEC’s enforcement decisions.

Schwartz stepped in to offer a more grounded read. He pushed back on the banking cartel theory, suggesting competitive dynamics between crypto projects offer a more plausible explanation for why certain enforcement decisions were made.

Schwartz is not a peripheral figure in this story. He is one of the original architects of the XRP Ledger. He lived through the SEC’s prolonged lawsuit against Ripple, which significantly slowed XRP’s growth and adoption. His opinion on what drove regulatory behavior carries real credibility.

The Takeaway

Schwartz stopped short of making strong claims. He acknowledged the absence of hard evidence. While prominent figures like Charles Hoskinson have previously dismissed ETHGate as a conspiracy theory, Schwartz stated clearly that it feels more real than fake to him. For a figure of his standing to say that publicly, it moves the conversation forward without overstating what is currently known.

The debate over whether Ethereum received favorable regulatory treatment is ongoing. Schwartz’s comments add a significant data point to that record.