Today the name of the California-based start-up Ripple that has an aim to enhance and facilitate cross-border bank transactions by using blockchain technology can be often seen in a wide number of media outlets. The reason of this increasing popularity is the controversial situation with its regulatory status.
According to Asheesh Birla who is the senior vice president of product at Ripple, the most serious risk for their company today is regulation. “We’re in an environment where regulation is so important, and […] our biggest risk I think is regulation,” added he.
That’s why the company has taken a decision to build up a very large regulatory team that will have a responsibility to ensure that the next wave of clients that will be attracted by the startup won’t have any difficulties due to regulatory issues.
“We are going around the world making sure that for the next 1,000 customers that we want to bring on which we think we can do in the next two years that regulation is not going to be an issue,” explained Birla.
One of the regulatory issues that represents itself a threat for Ripple today is the uncertainty whether XRP should be classified as a security or not. The U.S. Securities and Exchange Commission has clearly explained that Ethereum and Bitcoin should not be considered to be securities. Nevertheless, the SEC hasn’t mentioned XRP is this row.
As CoinSpeaker has previously written, Ripple Labs and its CEO Brad Garlinghouse have already mentioned more than once that XRP can’t be a security due to a number of reasons.
Garlinghouse explained his point of view the following way: “I think it’s really clear that XRP is not a security. XRP exists independent of Ripple and it would operate even if Ripple Labs failed. I don’t think that our ownership of XRP gives us control. Saudi Arabia owns a lot of oil that doesn’t give them control of oil”.
Asheesh Birla believes that one of the reasons why so many countries all over the world are quite conservative about cryptocurrencies is the fact that this sector is comparatively new. Nevertheless, according to him, cryptocurrencies have significant potential to lead the transformation of the world.
Birla also pointed out that Ripple is doing much more to innovate the world than traditional banking institutions. The company believes that their technology will help smaller financial organizations and institutions to have more opportunities to compete with bigger entities.
Nevertheless, Birla also explained that as fintech startups such as Ripple didn’t have an opportunity to offer competitive compensation packages like traditional Silicon Valley tech firms, quite often it could be rather challenging for them to attract and retain specialists. But nowadays, the situation is much better than it was five years ago. And Ripple is continuing working on enhancing the terms for its employees.