Ripple’s CEO Brad Garlinghouse recently sat down with Monica Long, head of marketing at Ripple, for an ‘Ask Me Anything’ session. Brad answered many questions about the startup, regulations, the current state of the crypto market and so forth.
During the course of the discussion, Long asked Brad whether Ripple’s native token XRP is a security or not. Garlinghouse responded to the question by reiterating that “XRP is clearly not a security.”
The Ripple CEO went on to say that XRP exists independently of the parent company, which has created products such as xRapid and xCurrent which utilizes XRP to facilitate cross-border settlements.
“There is a whole bunch of base layer reasons for that. One of the most important I think is … if Ripple the company shuts down, XRP trades on over a hundred exchanges around the world and XRP will continue to trade.”
It has been rumored that the U.S. Security and Exchange Commission (SEC) would consider XRP as security. While Garlinghouse maintains that the XRP ledger exists independent of Ripple Labs, the company owns more than 60% of the XRP coins ever created. That’s why there have been reports claiming that the 2nd largest cryptocurrency by market cap is centralized.
In fact, the regulatory confusion surrounding XRP is one of the reasons major crypto exchanges like Coinbase and Gemini are reluctant to list Ripple. If the coin were listed in one of these major exchanges, the liquidity and value of the token would likely increase.
Also, crypto purists believe XRP must not be classified as decentralized as it doesn’t fulfil certain criteria. For instance, they do business with banks, which goes against the vision of Satoshi Nakamoto. Satoshi is the anonymous inventor of Bitcoin and the most revered figure in the crypto community.
While Garlinghouse’s latest statement is meant to reassure investors that XRP is not a security, the only thing that can put investors at peace is an official confirmation by the SEC. Therefore, the regulatory status of XRP remains in limbo.