Ripple’s legal battle with the SEC went ‘extremely well’, CEO says – Reuters News in France and abroad

PARIS — Ripple CEO Brad Garlinghouse is confident the company will do well as its long legal battle with the U.S. Securities and Exchange Commission comes to an end.

The San Francisco-based startup is fighting the SEC over allegations that Ripple, Garlinghouse and Executive Chairman Chris Larsen engaged in an illegal securities offering through the sale of XRP, a cryptocurrency the company uses both commercially and with which it is closely associated.

Ripple challenged the SEC’s findings, saying XRP should be treated as a virtual currency rather than an investment contract like a stock.

“The trial has gone extremely well, and much better than I could have hoped for when it started about 15 months ago,” Garlinghouse said during a fireside chat hosted by CNBC during the Paris Blockchain Week Summit on Thursday. “But the wheels of justice are moving slowly. »

The SEC was not immediately available for comment when contacted by CNBC.

Earlier this week, a judge ruled the SEC cannot alter the content of emails claiming to show there were conflicts of interest regarding the watchdog’s handling of XRP and other tokens, such as ether.

Ripple is already “working in the worst case”, having sold “zero” corporate contracts to financial institutions in the US last year. “We have record growth,” he said. “It’s just outside the United States. »

Founded in 2012, Ripple bills itself as a blockchain-based alternative to SWIFT, the global interbank messaging system that enables billions of dollars in payments every day. The company sells its software to banks and fintech companies.

Ripple also uses XRP, the sixth-largest cryptocurrency by market value, to facilitate cross-border transactions. The company holds the majority of the 100 billion XRP tokens in circulation, which it periodically releases from an escrow account to maintain price stability.

Brad Garlinghouse, Managing Director of Ripple Labs Inc., speaks during a panel discussion at the Singapore FinTech Festival in Singapore, Monday, November 12, 2018.

Wei Long Tay | Bloomberg | Getty Images

Garlinghouse said there was a lot at stake if his company did not win the lawsuit.

“This case is important, not just for Ripple; it is important for the entire crypto industry in the United States,” he said. “It would be really negative for crypto in the United States. »

If Ripple loses, most tokens traded on platforms in the United States would be considered securities, Garlinghouse said, meaning those platforms would have to register with the SEC as brokers. “It’s the cost, it’s the friction. »

“If you determine XRP as a Ripple security, we need to know every person who owns XRP,” he said. “It’s an SEC requirement. You need to know all of your shareholders. It is not possible. »

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Ripple’s legal battle with the SEC went ‘extremely well’, CEO says – Reuters News in France and abroad

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