In this photo illustration of a corrugated cryptocurrency “Altcoin” taken in London, England on April 25, 2018.
Jack Taylor | Getty Images News | Getty Images
Fintech company Ripple has made great strides in its legal dispute with the US Securities and Exchange Commission, CEO Brad Garlinghouse told CNBC on Monday.
Garlinghouse stated that he expects that a case centered on XRP, the world’s seventh largest cryptocurrency, may be concluded next year.
“Despite the slow progress of the judicial process, we have seen pretty good progress,” he told CNBC’s Dan Murphy.
“Obviously, we have seen the judge ask good questions. I think the judge realizes that this is not just about Ripple, it will have a wider impact.”
Garlinghouse said he hopes it will close next year.
Headquartered in San Francisco, Ripple attracted a lot of attention during the cryptocurrency frenzy in late 2017 and 2018, when the prices of Bitcoin, Ethereum and other cryptocurrencies soared to record highs.
XRP is a token closely related to Ripple, benefiting from this rebound, hitting a record high of more than $3. Since then, the price has fallen sharply from that price, but in the latest crypto wave, the year-to-date increase has exceeded 370%
Ripple’s technology is designed to allow banks and other financial services companies to send money across borders at a faster rate and lower cost. The company also sells another product that uses XRP for cross-border payments, called on-demand liquidity.
The US Securities and Exchange Commission is concerned about Ripple’s relationship with XRP, accusing the company and its executives of selling $1.3 billion worth of tokens in an unregistered securities offering. However, Ripple believes that XRP should not be regarded as a security, and this classification will make it subject to more regulatory scrutiny.
At the same time, regulators around the world are carefully studying cryptocurrencies. This market is still largely unregulated, but has flourished last year.
Garlinghouse said the United Arab Emirates, Japan, Singapore and Switzerland are examples of countries that have shown “leadership” in regulating encryption, while China and India have hit the industry.
“In general, the direction of travel is very positive,” Garlinghouse said.
Former Credit Suisse CEO Brady Dougan said that regulation is a key area in the crypto space and may evolve over time.
“This is a market in the early stages of development,” Dougan, who now runs the financial technology company Exos, told CNBC. “I think this is a healthy market, and it will continue to develop in a positive way.”
Ripple is a privately held company with a final valuation of US$10 billion. Its investors include Alphabet’s venture capital arm GV, Andreessen Horowitz, and Japan’s SBI Holdings.
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