CEO of Ripple, Brad Garlinghouse, in an interview with Fortune at CB Insights Future of Fintech conference in New York, argued why XRP is not a security and should be listed on Coinbase and other fiat exchanges.
Brad Garlinghouse, CEO Ripple, has argued his side of why XRP is not a security and should be listed on Coinbase. For starters, it is important to understand the basic difference between XRP and Ripple.
Ripple is the company which sells blockchain technology to financial institutions while XRP is the token that is traded on exchanges. Garlinghouse uses this as one of his arguments as to why XRP isn’t a security, as simply owning XRP doesn’t give stake in the company Ripple.
“I think it’s really clear that XRP is not a security. For one, XRP’s blockchain, or public ledger, exists independent of Ripple, and would keep functioning even if the company failed; what’s more, XRP tokens serve a technological purpose (facilitating monetary transactions) that traditional securities like stocks do not. XRP also does not entitle its holders to a stake in Ripple the company itself.”
He goes on to compare XRP and Ripple to Saudi Arabia and Oil. Explaining that just because they own a lot of oil, doesn’t give them control of oil. Although it has been reported that Ripple owns around half of all XRP tokens.
“I don’t think that our ownership of XRP gives us control. Saudi Arabia owns a lot of oil—that doesn’t give them control of oil.”
Whether regulators will agree or disagree with Garlinghouse’s arguments, it remains to be seen what the SEC thinks as they have yet to announce whether or not XRP is a security.
They did give speculation as to which way they are leaning by saying, “Systems that rely on central actors whose efforts are a key to the success of the enterprise” would be subject to application of the securities laws.” To be clear, they didn’t specifically mention any coins/tokens. All that is known now is that Bitcoin and Ethereum aren’t securities and Coinbase has yet to add XRP to their exchange.
Source: Altcoin Buzz News
Original Post: Coinbase should add XRP, says Brad Garlinghouse CEO of Ripple