Fintech company Ripple is making big strides in its legal dispute with the U.S. Securities and Exchange Commission, chief executive Brad Garlinghouse told CNBC on Monday.
Garlinghouse said he expects the case, which focuses on XRP, the seventh-largest cryptocurrency in the world, to be completed likely next year.
We see very good progress despite the slow judicial process. Clearly we see good questions being asked by the judge. And I think the judge realizes that this is not just about Ripple, but it’s going to have wider implications.– Brad Garlinghouse
Ripple, which is headquartered in San Francisco, caused a lot of noise during the crypto-frenzy in late 2017 and 2018, where the prices of bitcoin, ether, and other cryptocurrencies skyrocketed.
XRP, a token with which Ripple is closely associated, benefited from this rally, reaching an all-time high of over $3. Since then it has fallen dramatically from this price, but the latest wave of cryptocurrency growth has recorded a gain of more than 370% in the year to date.
Ripple’s technology is designed to allow banks and other financial services companies to send money across borders faster and at a lower cost. The company also markets another product that uses XRP for cross-border payments called “On-Demand Liquidity“.
The SEC is concerned about Ripple’s ties to XRP, claiming that the company and its executives sold $1.3 billion worth of tokens in an unregistered securities offering. But Ripple argues that XRP should not be seen as security, a categorization that would put it under much more regulatory control.
The case comes as regulators around the world take a closer look at cryptocurrencies, a market that is still largely unregulated but has boomed over the past year.
Garlinghouse said the United Arab Emirates, Japan, Singapore, and Switzerland are examples of countries that are showing “leadership” in market regulation, while China and India have fought the industry.
“In general, the direction of the trip is very positive,” Garlinghouse said.
Brady Dugan, the former CEO of Credit Suisse, said the legislation is a focal point for crypto and is likely to grow over time.
“It’s a market that’s early in its development,” says he, who now runs fintech company Exos. “I believe it’s a healthy market and it’s a market that will continue to grow in a positive way.”– Brady Dugan
Ripple, a private company, was valued for the last time at $10 billion and counts as investors individuals such as Alphabet’s venture capital division, GV, Andresen Horovich, and Japanese SBI Holdings.