Ripple CEO on the way forward for XRP as speak rises on banning cryptocurrencies
Ripple is known for its groundbreaking cryptocurrency XRP and has been in litigation with the US Securities and Exchange Commission since last year.
Brad Garlinghouse, CEO of Ripple, doubled his frustration over the lack of clarity in US digital asset regulation during an appearance on CNBC’s “Squawk Box” on Wednesday.
He says a big part of the problem with US crypto regulation is not the cryptocurrency players but the lack of action by US regulators compared to global counterparts. The SEC accused Ripple, co-founder Chris Larsen and Garlinghouse, of making an illegal securities offering that allegedly raised more than $ 1.3 billion from the sale of XRP.
XRP was trading around 8% Wednesday morning amid a crypto rebound and up more than 300% since the start of the year, but fell well from its YTD high during the recent crash in cryptocurrencies. Bitcoin had rebounded from its massive recent decline, hovering around $ 40,000 on Wednesday.
“There’s a misunderstanding about how these technologies can be applied,” Garlinghouse said. “In the United States there was a lack of regulatory clarity. In other countries, the G20 markets, they have invested time and energy, either through legislation or through regulation, to create that clarity and certainty that allows investors to participate and build entrepreneurs. “
Ripple was ranked 38th on this year’s CNBC Disruptor 50 list.
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Fighting between the crypto industry and regulators continues – on Wednesday the UK banned an advertisement calling for people to buy bitcoin, calling it “irresponsible”. An opinion piece in the Wall Street Journal earlier this week called for a crypto ban, citing topics like hackers using cryptocurrencies to get paid for cyberattacks like the recent ransomware incident in the Colonial Pipeline.
According to Robinhood, this year’s # 1 CNBC disruptor company, 9.5 million customers traded crypto on Robinhood Crypto in the first quarter of 2021, compared to 1.7 million in the fourth quarter of 2020.
Ripple’s on-demand liquidity service uses XRP as a kind of “bridge” between currencies, allowing payment providers and banks to process cross-border transactions much faster than traditional payment channels.
Despite the return of crypto volatility this month – Bitcoin is still down more than 32% this month because of its monthly decline since 2018 – it and other tokens like XRP have hit new heights this year. Ripple owns most of the XRP tokens in circulation and sells a tiny portion of its holdings every month.
“XRP is an open source technology that is very similar to Bitcoin,” said Garlinghouse. “But the SEC claims that these are investment contracts … that Ripple sales of XRP to our customers are actually an investment contract. That is not true. When you buy XRP, you do not own Ripple and, ironically, you have XRP -Owners who tried to sue the SEC for bringing the case in the first place. “
Bitcoin, energy consumption and Elon Musk
Ripple’s CEO has been a critic of Bitcoin mining’s energy usage, but says he is nowhere near the only person who has brought up the problem. Everyone from Elon Musk to Bill Gates and Jack Dorsey is weighing in, and Ripple is not waging a secret war on Bitcoin.
“If Ripple could control these people, we probably wouldn’t have a lawsuit from the SEC,” he said.
Musk’s Monday tweet that he spoke to Bitcoin miners about energy efficiency ideas that were “promising” helped boost Bitcoin.
Earlier this month, Ripple strengthened its board of directors and appointed former US treasurer Rosie Rios.
“I think ultimately the industry should focus on the utility. And these technologies solve real problems for real customers,” Garlinghouse previously told CNBC, adding that Ripple will continue to use its XRP ledger and tokens to make payments more efficient to design . Still, the company has threatened to move to other jurisdictions if XRP is considered collateral in the US
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