Ripple CEO Brad Garlinghouse Discusses the Future of XRP

The startup controls the third largest cryptocurrency in the world, XRP. The banks have registered in their network and have bought shareholdings in their businesses, which want to reconfigure how money moves around the world. And yet, when it comes to getting a coveted listing for XRP in two of the major cryptocurrency exchanges in the US. UU., Ripple has not been able to close the deal.

It is not for lack of attempts. Last year, the San Francisco-based company suggested paying financial incentives to the headquarters, Gemini and Coinbase, according to four people with direct knowledge of the matter, who asked not to be identified to discuss private information.

For all the enthusiasm that surrounds Ripple and XRP, its absence in markets like Gemini and Coinbase is striking. By hanging the money in front of the exchanges, Ripple pointed out that his future success depends in part on getting XRP on the list of major trading venues. But there is a major setback in that effort: US officials. UU They have warned unlicensed exchanges that they do not include chips that could be considered securities. The control of XRP by a single company has fueled speculation that it could be under that designation.

Last year, a Ripple executive asked if a cash payment of $ 1 million could persuade Gemini to enlist XRP in the third quarter, according to people familiar with the matter. That followed Ripple’s other attempts to have Gemini add XRP, exploring strategies such as paying reimbursements and covering related costs, people said.

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During the preliminary talks with Coinbase last fall, Ripple said it would be willing to lend the stock market more than $ 100 million in XRP to begin allowing users to trade the asset, according to a person familiar with that discussion. Ripple, without submitting the proposal in writing, told Coinbase that he could return the loan in XRP or dollars, the person said. If the exchange had chosen the latter, it could have benefited if the tokens had become more valuable by being included in the list, the person said.

Gemini and Coinbase declined to follow the proposals, the people said.

Presented with a description of Ripple’s proposals to the exchanges, company spokeswoman Emmalee Kremer said some of the information was incorrect, but declined to specify what details she was discussing. “Anyway, Ripple has always been transparent about our focus on building and growing a strong XRP ecosystem,” he said. “We want XRP to be the most liquid digital asset possible to enable faster and cheaper global payments.”

Gemini, who was co-founded by Cameron and Tyler Winklevoss, declined to comment. A representative of Coinbase refused to talk about specific assets, but referred Bloomberg to the quotation framework of the stock exchange.

It is not necessarily unusual to pay for a list of cryptocurrencies. Costs range from $ 1 million “for a reasonably considered token, to $ 3 million for an opportunity to obtain quick liquidity,” according to a report by Autonomous Research, adding that the figures are based on conversations between market participants and not they are exact.

It is not necessarily unusual to pay for a list of cryptocurrencies. Costs range from $ 1 million “for a reasonably considered token, to $ 3 million for an opportunity to obtain quick liquidity,” according to a report by Autonomous Research, adding that the figures are based on conversations between market participants and not they are exact.

For its followers, XRP is a valuable link between the world of banking and digital currencies that has the backing of a Silicon Valley technology company. XRP is designed to revolutionize the way banks transfer cash across borders, making transactions faster and cheaper. Ripple uses incentives to entice market makers to buy and sell XRP and periodically sells its digital token to institutional investors, according to its website. While the currency does not represent an ownership interest in Ripple, the concern is that the close relationship could still lead regulators to consider the XRP as a guarantee. The authorities are still clarifying which tokens deserve that designation.

If XRP is classified as a value, it would be removed from the largely unregulated cryptographic currencies of the Wild West and would be subject to requirements similar to those governing assets such as stocks. Then the exchanges that offer it.

However, investors do not give up. Based on the success of Ripple in obtaining new customers and the speculation that it will be quoted in the US. The XRP soared more than 14 times in value between early December and early January, according to data compiled by CoinDesk. That was before Coinbase denied the speculation that it had decided to offer XRP in its market. On March 5, another increase occurred after CNBC scheduled Ripple’s CEO, Brad Garlinghouse, and Coinbase’s operations director, Asiff Hirji, to appear on the same program the following day, sparking speculation that who were about to announce their inclusion.

Paying for a listing could be perfectly legal, given that traditional markets charge such fees, said Jesse Overall, a Clifford Chance lawyer. But things could get complicated if you later consider that a digital token is an unregistered insurance, he said. In such a case, both the exchange and the issuer could face sanctions, he said.

“Inclusion in an exchange is an integral part of the process of facilitating illegal, unregistered, illegal and illegal issuance of securities to people who can not buy,” Overall said.

Companies must pay the quotes on the largest US stock exchanges. UU., But they must also meet and maintain the quotation requirements. For example, Nasdaq Inc.’s stock markets can charge annual listing rates ranging from $ 42,000 to $ 155,000, according to the company’s rule book.

Gemini and Coinbase limit the cryptocurrencies that are commercialized in their platforms. Gemini customers can only market Bitcoin and Ether, although the Winklevoss brothers said last month they want to expand to others like Bitcoin Cash and Litecoin. Coinbase has Bitcoin, Bitcoin Cash, Ether and Litecoin and reiterated on March 5 that it has not decided whether it will add new coins.

The US Securities and Exchange Commission UU He has said that platforms that serve as trading venues for digital assets that are considered securities must be registered with the agency as a national exchange or qualify for an exemption. The regulator also cited firms and individuals behind the offers of currencies that it believes may be breaking the law, said a person with direct knowledge of the issue earlier this year. A SEC spokesman declined to comment on the agency’s opinion on XRP.

The SEC warnings have resonated in the industry. In March, the Winklevoss twins presented a proposal for a regulatory body to govern the markets and custodians of digital currencies.

There is a reason why listing rates are not as common in crypto as in traditional securities platforms, said Dave Weisberger, CEO of CoinRoutes, a cryptocurrency data and order routing company.

“In the capital space, contribution rates have always been historically linked to the notion of regulation,” while digital currencies are relatively unsupervised, he said.

However, the reason for the list is still there: an encryption issuer who pays to get his chip in an exchange “could make that payment 100 times by selling those coins when it is ready,” Weisberger said.