In an exclusive interview with CNBC, the CEO of blockchain services company Ripple said that “confusing” regulations in the United States will drive more cryptocurrency companies to leave the United States, as companies like Ripple look to hire and invest abroad.
Ripple CEO Brad Garlinghouse said on Thursday: “Europe has really taken the lead, countries like the UAE…the growth you’re seeing…even the UK and Singapore- They are clarifying how they will regulate these digital assets”.
“This allows for the passage of rules of the road that allow entrepreneurs, investors and regulators to engage constructively,” Garlinghouse said on CNBC’s “Squawk Box Asia.”
“Frankly, that’s why you see startups and investment flowing into other jurisdictions – Europe, of course, has been a big beneficiary of the mess that exists in the US,” he added.
His comments came after the cryptocurrency firm announced Wednesday it would acquire Swiss cryptocurrency custody service Metaco, at a time when U.S. regulators are cracking down on companies like Ripple and cryptocurrency exchange Coinbase.
I think it’s fair to say that the U.S. has confused the rules of the road in the crypto industry as much as possible. The SEC is indeed at the forefront of this confusion.
Brad Garlinghouse
Ripple CEO
The acquisition of Metaco is expected to expand Ripple’s product portfolio and give it access to an attractive client base including Citibank and BNP Paribas.
“We think Metaco is a perfect fit from the standpoint of our efforts to grow customers today,” Garlinghouse said.
Crypto companies are threatening to leave the United States to signal to regulators that the country may be missing out on a key technological innovation.
Ripple is filing a lawsuit with the SEC. The SEC accused Ripple, Garlinghouse, and the company’s co-founder Chris Larsen of violating securities laws by selling XRP without first registering with the SEC. XRP is the native cryptocurrency on the Ripple network.
Unfortunately, (the crackdown) encourages companies like Ripple to invest more outside the US
Brad Garlinghouse
Ripple CEO
“Unfortunately, this encourages companies like Ripple to invest more outside of the U.S.,” Garlinghouse said, adding that 95 percent of Ripple’s customers are not in the U.S. and that most of Ripple’s hiring this year will be in the U.S. outside the US
Garlinghouse said Ripple is in good financial shape. According to him, Ripple financed the Metaco acquisition with $250 million in cash on its own balance sheet.
“Ripple’s balance sheet is very strong and we’re aggressively attacking, and that’s just one example of that,” Garlinghouse said.
“Be greedy when others are fearful, and be fearful when others are greedy,” he said, citing investor billionaire Warren Buffett.
Regarding Ripple’s listing plan, Garlinghouse said that they are “in no rush to go public” and “do not need to raise more funds.”
“So if we were going to consider (going public), it would be at a time and place that would make sense. We don’t want to do it unless we feel like it actually enhances the ability to grow the business, the customer experience,” he added.