Brad Garlinghouse, chief executive officer of Ripple Labs Inc., speaks during a panel discussion at the Singapore FinTech Festival in Singapore, on Monday, November 12, 2018.
Wei Liet Tay | Bloomberg | beautiful pictures
PARIS – Ripple CEO Brad Garlinghouse is confident that the company will launch as well as the lengthy court battle with the US Securities and Exchange Commission is nearing a conclusion.
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 shares. XRPa cryptocurrency that companies use for commerce and are closely linked.
Ripple has refuted the SEC’s findings, arguing that XRP should be treated as a virtual currency rather than an investment contract like a security.
“The lawsuit has gone incredibly well and is much better than I could have hoped when it started about 15 months ago,” Garlinghouse said at a fireide chat hosted by CNBC at the Summit. top of blockchain week in Paris on Thursday. “But the wheel of justice moves slowly.”
The SEC was not immediately available for comment when contacted by CNBC.
Earlier this week, a judge rule The SEC cannot edit the content of the emails with the intention of showing a conflict of interest regarding how the watchdog handles XRP and other tokens, such as ether.
Ripple “worked in a worst-case scenario,” having sold “zero” enterprise contracts to financial institutions in the US last year. “We are having record growth,” he said. “It’s right outside the US.”
Founded in 2012, Ripple touts itself as a blockchain-based alternative to SWIFT, the global interbank messaging system that enables trillions of dollars in payments per 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 owns the majority of the 100 billion XRP tokens in circulation, which are periodically released from an escrow account to keep the price stable.
Garlinghouse said there’s a lot at stake if his company doesn’t win the lawsuit.
“This case matters, not just for Ripple; it matters for the entire crypto industry in the United States,” he said. “It would really be negative for crypto in the United States.”
If Ripple loses, most tokens traded on U.S. platforms will be treated as securities, which means those platforms will have to register with the SEC as brokers, Garlinghouse said. “It’s the cost, it’s the friction.”
“If you define XRP as the security of Ripple, we have to know everyone owns XRP,” he said. “That’s a requirement of the SEC. You have to know all of your shareholders. That’s impossible.”