Ripple writes an open letter on crypto regulation issue
The leadership duo of Ripple requested the US Congress not to generalize since many in the industry are responsible actors and crypocurrencies would be complementary to the dollar.
The leadership duo of Ripple requested the US Congress not to generalize since many in the industry are responsible actors and crypocurrencies would be complementary to the dollar.
Brad Garlinghouse, CEO of Ripple and Chris Larsen, Executive Chairman and Co-founder of Ripple have asked US lawmakers for fair regulation of crypto assets in an open letter sent to the US Congress.
The letter comes as a response to the growing dissent within regulators regarding digital currencies, and a recent Congress grilling of Facebook over the company’s plan to launch its Libra digital currency. The Ripple duo have requested politicians not to generalize and apply a one-size-fits-all approach to the crypto industry, encouraging Congress to categorizes crypto in a way that will identify the fundamental differences of the cryptocurrency space. It also urged Congress to support regulation of crypto, in a way that doesn’t harm companies’ abilities to make the most out of the technology and continue to innovate.
Garlinghouse and Larsen write in the open letter: “We urge you to support regulation that does not disadvantage U.S. companies using these technologies to innovate responsibly, and classifies digital currencies in a way that recognizes their fundamental differences—not painting them with a broad brush.”
The letter did add some praise for central banks, which it suggests are the right people to regulate crypto assets. “We don’t take for granted the vital role of central banks in issuing currencies and setting monetary policy in concert with the complex dynamics of economies around the world,” it said. “For centuries, governments have been well suited for the job because paramount to the acceptance of any currency is trust.
“Without regulatory clarity, we risk pushing the innovation, tax revenue and jobs that these new technologies create overseas.”
The letter mentions that many in the crypto and blockchain industry are responsible for their obligations to the US and International Law.
The letter stated: “Many in the blockchain and digital currency industry are responsible actors. We are responsible to U.S. and international law. We are responsible to serving the greater good.
Companies like ours in the United States, and others abroad, employ these innovations in partnership with regulated financial institutions to enable the world to move money across borders like it already moves information—efficiently, reliably, inexpensively. In our view, digital currencies have the opportunity to complement existing currencies like the U.S. dollar—not replace them.”
The letter also mentioned trust as an essential component of a currency gaining wider acceptance. Bitcoin, based on mathematics, succeeded because it removed the need to trust any party involved in the transaction process.
They concluded the letter saying: “You have the world’s attention. Let’s come together and seize the moment.”
Regulators had quickly called for scrutiny of the plan – leading the G7 to issue a letter outlining its plans to set up a high-level forum to examine the risks of such currencies to the financial system. The letter adds that the International Monetary Fund and central banks are also planing to participate.
France, the current holder of the G7 presidency, is to set up a group taskforce to study how central banks ensure cryptocurrencies, including Facebook’s planned Libra, are governed by regulations covering everything from money laundering laws to consumer protection rules.