XRP being declared a security in the US would not harm Ripple, but might hurt the country’s purse, said Brad Garlinghouse, CEO of the American blockchain company focusing on payments technologies.
“My very strong opinion [is] that it’s very hard to look at XRP as a security,” the CEO reiterated during the November 26 Pomp Podcast episode, hosted by Morgan Creek Digital co-founder Anthony Pompliano. Garlinghouse said he can’t think of any market globally or among the major G20 markets that think it to be a security, and declaring it as such in the US would create a larger technological rift between the States and other countries.
But if the American regulatory Securities and Exchange Commission (SEC) were to say that XRP is a security, “a lot of what Ripple does in the Unites States, we could continue, no problem,” the CEO said, adding that “more than 90% of RippleNet customers are outside the US,” so Ripple would “continue to build the business and grow,” he said.
Still, it’s the US that could be hurt should Ripple decide to leave, the CEO said. “We would no longer be a US taxpayer” after paying “probably […] a couple hundred million dollars in taxes,” he added.
The US regulatory framework, said the CEO, is “out of sync with what other major economies are doing,” which prevents it from competing “on a level playing field with what’s happening in some of these other markets.” As positive examples of regulatory clarity, he highlighted the UK, Singapore, Japan, Switzerland, and the UAE.
There are companies that refuse to use products enabled by Ripple, he said, “until there is clarity there,” adding that there are over 150 companies in the XRP ecosystem currently. But were there more clarity, Garlinghouse can’t say if more of Ripple’s customers would be from the US. “We are solving the cross-border payment problem, which is more of a pain for smaller countries,” he said.
The lack of regulation around XRP is also the reason why this coin wasn’t included in the payments giant PayPal’s recently announced crypto addition, Garlinghouse said. But the recently proposed Digital Commodity Exchange Act “would be a huge step” in both bringing regulatory clarity and putting the country on equal footing with some other G20 markets.
Ripple has been consistently denying that XRP is a security, particularly during the lengthy court proceedings that followed a lawsuit that claimed the company had effectively been offering the XRP token for sale as an unregistered security.
XRP is up 2.7% in a day and nearly 76% in a week, reaching USD 0.53 (at 9:27 UTC). Earlier this week it hit almost USD 0.75.
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