- Ripple’s CEO told CNBC he’s frustrated with the lack of regulatory clarity on crypto in the US.
- He said certainty is required so that investors can make better decisions.
- On Ripple’s legal battle with the SEC, he said: “So far, I feel good about how that’s been going.”
Ripple CEO Brad Garlinghouse told CNBC on Friday there is a need for “increased clarity” on cryptocurrency regulation in the US.
“I give credit to markets like Singapore and even parts of Korea where there really has been a thoughtful government-led effort to define and have clear regulatory frameworks around cryptocurrencies,” he said on CNBC’s “Squawk Box Asia.”
Garlinghouse added he is frustrated with progress in the United States on the matter, given that such a framework would provide more clarity to investors on assessing investments in the space.
His San Francisco-based blockchain startup Ripple has been engaged in a battle with the Securities and Exchange Commission since December. The regulator had charged Garlinghouse and co-founder Chris Larsen for illegally raising $1.3 billion through the sale of its XRP token. This token, according to the SEC, is a security and not a cryptocurrency.
“So far I feel good about how that’s been going, but it’s certainly frustrating,” Garlinghouse said on Friday.
The SEC had previously asked the court to ban XRP’s circulation, oblige the company to return the profit received, and to pay an additional fine. That resulted in a pessimistic market reaction that led to many crypto exchanges removing the token from trading.
But the situation changed in the spring of 2021, according to Victor Argonov, senior analyst and crypto specialist at international fintech EXANTE. The court allowed Ripple to examine SEC official correspondence, demanded that it explain why it considers XRP – but not bitcoin or ether – as a security, and also kept the right to secrecy of detailed financial information over the years for Ripple, Argonov said.
Now many investors are confident that Ripple will win the court or get off with just a fine, according to the analyst.
“As we can see, the legal status of cryptocurrencies is still controversial,” he said. “If desired, the court can find arguments in favor of recognizing any of the listed coins as securities or other types of assets. Of particular uncertainty is the fact that the persecution of Libra and TON took place during the Donald Trump administration, while Joe Biden is expected by many to have a softer policy towards cryptocurrencies.”