Ripple Demands Same Regulatory Standard for XRP As Bitcoin (BTC) And Ethereum (ETH)
XRP has been gaining tremendously, but it’s not yet achieving it’s 100% potential. According to Ryan Zagone, the director of regulatory relations of Ripple, policy uncertainty is the main reason for the cryptocurrency not doing as well amongst American financial institutions. He spoke at DC Fintech Week.
Zagone stated for the same treatment like Bitcoin and Ethereum with XRP. He explained-
“Today, the policy certainty in the US exists for Bitcoin and Ethereum, despite the fact that those are China-controlled platforms. So activity goes to those platforms. What we need to do from a policy perspective in the US is look at places where there are uncertainty.
And one place I’m speaking directly for me here is XRP, where it looks like Bitcoin. It’s decentralized. It’s open-source. We have a small 7% of the validation power on that. Rather small on there. Giving clarity to those ones that are very similar to Bitcoin and Ethereum that have the same characteristics and should be classified the same way. And then we’re creating a level playing field across all the cryptos.
I’m not anti-Bitcoin or anti-Ethereum, by any means. I think there’s a lot of great potential and breakthrough there. But we need to have a level playing field so the market can pick which ones they want to use and not be, as today they are, hindered by regulatory uncertainty.”
Is Ripple a Security?
A security in financial terms is determined using the Howey Test’s four simple questions.
1) Is XRP an investment of money/assets? Ripple states that XRP is a digital asset created by Ripple which is sold. Hence it is not an investment vehicle.
2) Is there an expectation of profits from the investment? Ripple has never promised that investors that ‘hodl’ XRP will gain more value from it.
3) Is the investment of money/assets in a common enterprise? Ripple will have to answer with substantial evidence to the SEC as Ripple owns 80% of XRP. The major issue manipulation of XRP is possible with Ripple having control of most of the supply. Thus being a point of debate.
4) Does any profit come from the efforts of a promoter or third party? XRP’s price is determined by market factors, which are the people buying and selling and so Ripple has no problem with this point.
With the Howey Test, it suggests that XRP should be classed as a non-security and so should be treated in the same manner as Bitcoin and Ethereum. If it does gain this status, several banks in America will follow using Ripple’s technology and XRP utilization similar to Euro Exim Bank.
Ripple has proved its track record and competitiveness with a whopping 200 partnerships in a single year. Marching against SWIFT has shown the banks Ripple’s true power concerning cheaper transactions and faster speeds.
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