As Congress in the US put up a huge fight against the centralized Libra cryptocurrency from Facebook, it appears as if Ripple is shitting the bed. Congress stated that no centralized entity should be allowed to issue a cryptocurrency over fears that the project will try to replace a central bank or have way too much data on its users – thanks for that Cambridge Analytica. In a bid to save its skin, Ripple has taken out a full-page ad in the Wall Street Journal (WSJ) and placed a letter, begging Congress to look at Ripple differently.
#Ripple CEO writes open letter to Congress over regulatory uncertainty.
— ???? ??? (@BankXRP) July 29, 2019
It’s All Much of a Muchness
The reason Ripple is getting so afraid boils down to the fact that its token XRP is issued by a centralized entity and is completely pre-mined. This is what Congress has a huge problem with, and if it judges projects based on this then Ripple will end up facing huge legal battles. If you look at the basic fundamentals of XRP and Libra, the two look similar. However, when you get down to the nitty gritty and into use cases, it’s very clear that XRP is a totally different token.
Ripple Powering Banks, Not Replacing Banks
For Ripple to fear that it might get shut down means that it’s done something wrong and really doesn’t want an investigation – it’s probably also why it quietly changed the wording on its site. While Libra is seeking to become a token used for payments between Facebook users and businesses, XRP is used to power cross-border payments between banks. A number of major banks around the globe have already teamed up with Ripple and are using its tech. This huge amount of adoption by big-name banks should be more than enough for Congress to see that XRP is no threat to the international banking world.
Echoing Pro-American Sentiment
In the letter, Brad Garlinghouse – Ripple CEO – pleads to congress, stating that if it actively pushes back against crypto innovation, then the US will lose out on additional tax revenue, a huge job market, and its edge as a financial powerhouse. Washington desperately needs to defend crypto rather than fighting against it if America wants to truly become great again and a leading player in the crypto and blockchain world. If Washington fails to look after America’s crypto industry, then it will likely force major businesses in the industry to move overseas to crypto-friendly jurisdictions.
This cry for Congress to look at each project differently is likely to fall on deaf ears, as Congress has more than likely already made up its mind. Trump is already more of a Ripple fan when compared to Bitcoin, so this could play into Ripple’s future. Either way, the future is still not set in stone, meaning Ripple’s life could still be on the line.