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Ripple CEO Brad Garlinghouse believes his business can still thrive in a hypothetical scenario where XRP is declared a stock by US lawmakers.
Appearing in episode 439 of the Pomp podcast, Garlinghouse spoke about the implications of reporting XRP as a security by the United States Securities and Exchange Commission, or SEC. He said such a stance would go against the prevailing view in the G20 markets.
While acknowledging that “it’s very difficult to think of XRP as security,” Garlinghouse said:
“You know if XRP was considered a stock here in the US, you know we have other G20 markets that took a different point of view. I don’t know of any market in the world that thinks XRP is a stock. “
Garlinghouse added that “over 90% of RippleNet’s customers are outside the United States,” suggesting that a designation of securities would not necessarily hamper the underlying business of the company.
If XRP were declared a security in the United States, investors (including Ripple) would have to complete the broker’s registration with the SEC.
XRP’s regulatory status has come under intense scrutiny over the past few years, with veteran trader Peter Brandt the latest public figure to declare it a title.
On the other side of the spectrum, Congressman Tom Emmer, a Republican from Minnesota, argued in August that XRP was no security.
Ripple has been the subject of a class action lawsuit from disgruntled investors claiming that XRP is a security. The lawsuit alleges false publicity and a charge of unfair competition against Ripple. An amended March filing claimed Garlinghouse was buying XRP from potential investors while simultaneously liquidating its holdings.
XRP is back in the spotlight this month after an explosive rally that pushed the cryptocurrency above a multi-year range. It was the subject of strong profit-taking Thursday, down more than 28%.
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