- Ripple co-founder Chris Larsen joins a new initiative designed to help regulators understand new technologies.
- Through closer cooperation, innovations from the blockchain and fintech sectors are to be promoted more strongly.
In an interview at UBRI Connect 2019 between Michelle Bind, Global Head of Government Relations, and Kristin Smith, Director of the Blockchain Association, Ripple describes how further legislative developments in the area of digital assets will determine the pace of innovation in the industry.
United States hinders innovation
The legal framework has progressed differently worldwide and offers good conditions outside the USA for developing new ideas and implementing projects. In Great Britain, Singapore, Switzerland, Malta or Abu Dhabi, there are already sufficient laws for the digital asset market that both support innovations and counteract risks.
In the UK, for example, a law has recently been amended to state that XRP is not collateral under the Securities Act. According to Ripple, these steps can serve as a model for other countries, such as the United States of America, not to hinder further progress but to provide a fertile environment. Smith states that more and more companies are fleeing overseas as better conditions have been created for companies and individuals:
I’m very worried and I don’t think that is an irrational or paranoid viewpoint to take. Companies, even within members of the Blockchain Association, are moving their operations overseas… because there are strong consumer protections in place and certainty in those regulatory frameworks.
Mike Novogratz, multiple billionaire, pointed out in several interviews and via social networks such as Twitter that the USA could lose its leading role in fintech and blockchain to the world power China if politicians and regulatory authorities do not open up to new innovations and learn to understand the matter from the ground up. He elaborated on Twitter:
The acceptance of digital assets, being stable coins for payment systems, or securities offerings in tokenized form, or new forms of value like
$btc are all synergistic. What Xi is hinting at is the future will contain all of them.
Ripple co-founder joins regulatory initiative
Chris Larsen, co-founder and shareholder of Ripple, has joined the Alliance for Innovative Regulation (AIR). This new initiative aims to bring together regulators, Fintech executives, policy makers, financial institutions and other industry players in the innovation field to discuss the use of new breakthrough technologies.
In particular, a new awareness is to be created that involves politics and derives measures from this in order to create optimal legal starting conditions. The initiative consists of former experts from the financial sector such as David Ehrich, co-founder of the credit card start-up Petal or Thomas Curry, former auditor and partner at Nutter, McClennen & Fish.
AIR has raised more than $2 million in the first financing rounds to drive further development. The initiative is already working with 65 regulators worldwide, but the initiative will expand rapidly to intensify progress.
A good example of promoting cooperation between AIR and regulators is the recent TechSpring on Finance Crime in Washington D.C.. In a “hackathon” format, US regulators have sought and found technological solutions to age-old, persistent problems. Chris Larsen describes that innovations must be pushed further:
The goal is to create new models of collaboration between a complex network of regulatory agencies, and between regulators and industry.
As we reported earlier, Ripple established a subsidiary in Washington D.C. that is focused solely on working with regulators and policy makers to accelerate the development of Fintech innovation through close dialogue.