Ripple CEO points to regulatory confusion as US crypto firms seek growth elsewhere
Ripple CEO Brad Garlinghouse said U.S. crypto firms are increasingly focused on foreign jurisdictions due to the challenging regulatory landscape domestically.
“I think it’s fair to say the U.S. has made it as confusing as possible as to what the rule of the road are for the crypto industry.”
A spate of regulatory enforcement actions and uncertainty about the rules has resulted in capital and investment outflows from American shores, said Garlinghouse — naming the EU as a significant beneficiary due to this trend.
Talking to CNBC, the Ripple CEO laid the blame square on the Securities and Exchange Commission (SEC,) saying the agency had been “at the forefront of that confusion.”
Expansion overseas is the plan
Ripple has been in a legal dispute with the SEC since December 2020 over allegations of selling $1.3 billion of unregistered securities — in the XRP token.
The ongoing court case is expected to conclude shortly, with Garlinghouse predicting a verdict within the next six months.
Nonetheless, since the filing, Ripple has been growing its non-U.S. business. For example, in expanding its On-Demand Liquidity (ODL) service in Japan and partnering with non-U.S. banks such as Oman’s BankDhofar.
Garlinghouse mentioned that most of Ripple’s customers are now overseas, adding that most of this year’s new hires will focus on recruiting non-U.S. citizens.
“95% of our customers are non-U.S., and this year most of our hiring will be non-U.S. for some of those exact same reasons.”
Regarding Ripple’s recent acquisition of Metaco, Garlinghouse stated that the company’s operations are primarily centered in Europe, aligning well with the type of customers sought and the jurisdictions Ripple is targeting for expansion.
“We think Metaco is a perfect fit, from where we’re trying to grow our customers today.”
Ripple acquires Swiss custody firm Metaco
On May 17, Ripple announced acquiring Swiss-based crypto custody firm Metaco in a $250 million deal.
The tie-in will see Ripple expand its enterprise offerings for digital asset custody, issuance, and settlement services, primarily in the European market.
Garlinghouse told CNBC that Metaco is a perfect fit for Ripple because both companies make regulatory compliance a key business focus.
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