On Sunday (July 28), Brad Garlinghouse, the CEO of Ripple, and Chris Larsen, Ripple's Co-Founder and Executive Chairman, published their joint open letter to U.S. Congress.
In this letter, they explained that:
- Ripple, like many other companies in the blockchain and crypto space, are "responsible actors", i.e. they respect U.S. and international law.
- There are companies, for instance Ripple, that want to use these new technologies "in partnership with regulated financial institutions" for cross-border payments.
- Ripple sees "digital currencies" complementing fiat currencies (such as the U.S. dollar) rather than replacing them.
They then urged Congress to recognize that not all digital currencies are the same and to support regulations that allow blockchain and crypto firms to "innovate responsibly."
Finally, he argues that without more blockchain and crypto friendly regulation, the U.S. could the pushing the "innovation, tax revenue and jobs that these new technologies create overseas."
Garlinghouse's comments in this letter echoes what he said on Twitter on July 15 shortly after U.S. Treasury Secretary Steven Mnuchin's press conference about Libra and Bitcoin.
Back then, he said:
- "I agree that crypto isn't likely to replace fiat currencies - I have been very vocal that crypto isn’t likely to disrupt the US dollar and other G20 currencies in my lifetime."
- "But as Mnuchin indicated, the entire crypto industry should not be painted with one broad brush - it has come a long way since the days of Silk Road. For the industry to succeed, we need to work with regulators and within policies. Full stop."
- "XRP is uniquely equipped to solve a multi trillion dollar problem by offering a dramatically faster and cheaper bridge for cross border payments. @Ripple already works with regulators, banks and financial institutions (like @MoneyGram) to implement this around the world."
The timing of this letter makes sense since on Tuesday (July 30), the U.S. Senate Committee on Banking, Housing, and Urban Affairs (aka "Senate Banking Committee") is conducting a full committee hearing titled "Examining Regulatory Frameworks for Digital Currencies and Blockchain."
The witnesses will be Jeremy Allaire, Co-Founder, Chairman, and CEO of Circle, who is giving testimony on behalf of the Blockchain Association; Rebecca M. Nelson, a Specialist in International Trade and Finance at the Congressional Research Service; and Mehrsa Baradaran, Professor of Law at University of California, Irvine School of Law.
You can watch this hearing live on the U.S. Senate's website. It will start at 10:00 (Eastern Time or 04:00 UTC) on July 30.
So, what happens when Mr. Allaire goes to Washington?
As Circle pointed out in a blog post published on July 24, Circle CEO Jeremy Allaire will be "the sole crypto-industry representative" testifying about the need for greater regulatory clarity around crypto.
Circle says that:
- It is "the most regulated, licensed, and compliant crypto-finance company in the world," holding "an E-Money Issuer License to operate in the European Economic Area, Money Transmitter Licenses in 48 US states, and the first BitLicense to be awarded by the New York Department of Financial Services."
- It recently became the first major firm in the crypto space to receive "a comprehensive Digital Assets Business License" from Bermuda for its new international operations base.