Ripple threats to leave the US, warns of China as leader of new global financial system

  • Ripple is considering relocating its headquarters to the United Kingdom, Switzerland, Singapore or Japan if the regulatory environment in the United States remains hostile.
  • Chris Larsen warns that the US dollar could lose its status as the world’s reserve currency.

Ripple‘s co-founder, Chris Larsen, made it clear in an interview at the LA Blockchain Summit yesterday that the company could leave the US if the regulatory environment remains hostile to crypto and blockchain companies. In the interview with Fortune magazine’s Jeff Hohn Robert, Larsen revealed his frustration with the regulatory environment, citing the Securities and Exchange Commission as the main culprit for the hostility and inability to regulate the cryptocurrency sector.

Ultimately, Larsen warned that Ripple is about to move its headquarters overseas in response to excessive regulation. He added that almost every other country offers a more favorable regulatory climate for crypto than the US, but cited the UK, Switzerland, Singapore and Japan as the most likely destinations if Ripple leaves the US.

He believes that Ripple’s possible exodus will not end the United States’ influence on many of its services. However, it will be a relief to have another country and not the US as the main regulator, Larsen said. With regard to the lack of regulation and the exit from the US, Larsen further stated:

But everything else is still in limbo or worse kind of being regulated through enforcement. The message there is – blockchain, digital currencies are not welcomed in the US. If you wanna be in this business, you probably should go somewhere else. To be honest with you, we are even looking at relocating our headquarters to a much more friendly jurisdiction, you know lots of them: UK, Switzerland, Singapore, Japan and that’s a shame.

US dollar could lose status as the world’s reserve currency

Larsen also pointed out that the US government’s hostility towards crypto-companies gives China the upper hand when it comes to innovations in the field of a digital currency. As a result, the US may lose leadership of the global financial system to China. Ultimately, the US dollar could lose its status as the world’s reserve currency, Larsen said:

Unfortunately, I think the US is well behind in kind of stepping up to what is going to be the next generation of a global financial system. We have been in this incredibly fortunate position where the US has been steward of the global system. […] But we are being challenged in a major way. […] We are in a tech war with China and that goes upon the spectrum, if it is communication, surveillance, big data, AI, but also blockchain and digital assets.

And the reason is that China has recognized that those technologies are the key to who is gonna control the next gen financial system. SWIFT and corresponding banking is not gonna be the system we are gonna living with over the next two decades. […] I say China is just itching to be the one that designs this next gen system.

Larsen also expressed his hope that a democratic government could create a more favorable regulatory climate and thereby bring back to the US miners currently residing in China. He also warned against China’s power in view of the dominance of the hash power of the Bitcoin network by Chinese miners:

They control mining, all the Proof of Work. Mining is controlled by China: If you look at Bitcoin mining, it’s about 65% […] I mean does anybody has an any question that a Chinese miner is under the control of the Chinese Communist Party? Absolutely not. And miners are masters, right. They can rewrite history if they want and transactions. So huge advantage.

About Author

Jake Simmons has been a crypto enthusiast since 2016, and since hearing about Bitcoin and blockchain technology, he's been involved with the subject every day. Beyond cryptocurrencies, Jake studied computer science and worked for 2 years for a startup in the blockchain sector. At CNF he is responsible for technical issues. His goal is to make the world aware of cryptocurrencies in a simple and understandable way.

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