Regulators in the US have been heavily criticized by crypto industry leaders for the lack of clear regulations that define crypto’s place in the economy. Top-level executives of San Francisco-based crypto payment company Ripple have been speaking a lot about this lately, stating that no action from the US government would compel Ripple to exit the country.
In an interview with CNBC on October 23, Ripple CEO Brad Garlinghouse teased plans for his blockchain payments infrastructure company to potentially move to London, citing that the legal status of the XRP, the company’s native cryptocurrency, is the key to the company’s future in the US.
“Strongest internet companies built in the US, in part b/c of regulatory clarity. We have that opp with blockchain + digital assets. Responsible players like Ripple aren’t looking to avoid rules, we just want to operate in a jurisdiction where the rules are clear. #DCEA of 2020,” the CEO had noted in an earlier tweet.
Garlinghouse noted that the Financial Conduct Authority, which is the regulatory body in London, does not consider XRP a security, hence, one of the ideal jurisdictions for the company’s relocation.
“What you see in the U.K. is a clear taxonomy, and the U.K.’s FCA took a leadership role in characterizing how we should think about these different assets and their use cases. The outcome of that was clarity that XRP is not a security and is used as a currency. With that clarity, it would be advantageous for Ripple to operate in the U.K.”
This, however, is not the case in the USA, where Ripple is amidst a major class-action lawsuit with one of its investors filed back in May 2018. The investor was suing the organization over his losses after investing in XRP, claiming that the firm misled investors and sold XRP as unregistered security in violation of federal law.
The US Securities and Exchange Commission (SEC) has also been quiet about the issue, even though it has been taking actions against some token-based projects.
With the FCA “clarifying” that XRP is not a security and is used as currency, it would be “advantageous for Ripple to operate in the U.K.,” Garlinghouse continued.
The company has shortlisted a bunch of crypto-friendly nations besides London. Japan, Switzerland, Singapore, and the United Arab Emirates have been cited as other suitable locations by Garlinghouse.
Ripple is supposedly in talks with the SBI group about relocation to Japan. Garlinghouse previously said:
“I have spoken to the SBI team about the fact we are looking at the country as a potential destination.”