Brad Garlinghouse, CEO of the blockchain company Ripple and one of the prominent figures in the crypto industry, had been quite excited about the launch of Facebook’s stable coin Libra. He even sent celebratory champagne to the creator of Libra at that time because of the popularity Libra gained and how it also gave Ripple a good exposure. But with time as Libra started facing regulatory hurdles, Garlinghouse thinks that Facebook’s cryptocurrency may never launch.
In the most recent episode of Fortune’s show “Balancing the Ledger”, Garlinghouse reveals his scepticism about Libra, he said:
“I would bet that Libra…let’s say, by the end of 2022, I think Libra will not have launched.”
Further in the interview, when he was asked whether he was bullish about Facebook being able to stay on track with their primary goal of banking the unbanked, the primary vision set for Libra, he replied with a “No,” he further added “the regulatory headwinds they’re facing are substantial.” Both Ripple and Facebook aim at making money transfers across the globe seamless, even though there isn’t any competition between the two there might be a possible rivalry in the future.
Facebook has been on the radar of multiple regulatory bodies due to its controversial nature of collecting and using user data. Even before it unveiled Libra, the legal battles they have been involved in might be an obstacle on the road to Libra’s launch. Although Facebook has indicated that it won’t launch Libra without regulatory permission, Garlinghouse isn’t confident about Facebook even reaching that point in the project. He added:
“I think maybe [Libra] would have been better received if Facebook had not been the point of the arrow, Facebook has been in the crosshairs of a bunch of governments around the world…I think it’s going to be a tough road.”
Could XRP share the same fate?
Ripple has also faced a good share of strict scrutiny itself involving its cryptocurrency XRP. There have been questions regarding the fact of whether XRP is a security or not. If XRP is ever classified as a security, it would be subjected to additional rules and oversight by the Securities and Exchange Commission. Block.one was recently fined $24 million as a penalty for not being able to comply with the securities law in its EOS token sale. Garlinghouse is well aware of these facts and he explained the XRP and EOS are two different cases.
“One really important distinction is, the XRP ledger existed before Ripple the company,” he said. “Certainly we are an interested party in the success of the XRP ledger, for sure—we own a lot of XRP. But it’s a little bit like saying; Exxon owns a lot of oil. That doesn’t make oil a security.”