Ripple is Expected to Spend $200 Million Defending Itself Against the SEC
- Ripple is expanding its operations to Dubai following increased hostility in the US.
- Brad Garlinghouse expects a decision on the case with the SEC later this year.
Ripple’s legal battle with the US Securities and Exchange Commission (SEC) remains one of the longest legal disputes between a crypto company and the regulator. The outcome of the case is touted as a possible decider of the fate of crypto assets. However, the case against the SEC comes at a great monetary price.
Ripple’s CEO, Brad Garlinghouse, revealed that the crypto payment company would have spent $200 million defending itself by the time the case was decided. Garlinghouse made the revelation on Monday, May 8, during a chat at the Dubai Fintech Summit.
Garlinghouse believes that the tough regulatory stance in the US puts it behind other regions like the United Arab Emirates and the European Union, which recently approved the long-awaited Markets in Crypto-Assets (MICA) bill. Crypto enthusiasts in the US fear that the country is losing its grip on becoming a major player in the crypto industry.
Ripple’s CEO, Garlinghouse, blames the situation with crypto in the US on the country choosing politics over policy. Garlinghouse further shared tough advice with entrepreneurs, warning them to stay away from the United States. He said, “If I were you, I would not start in the United States.” The Ripple boss believes most U.S.-based investors would agree with his stance.
Ripple’s boss calls for clarity
Garlinghouse claims that most crypto service providers in the US need clarity in terms of regulation. The Ripple CEO added that the SEC needs to recognize that a large portion of those working in the industry were good actors who wants to operate according to laid-down policies.
The SEC filed a lawsuit against Ripple in late 2020, alleging that the crypto payment platform had offered XRP tokens as an unregistered security without authorization. Ripple has long stated that the SEC’s claim doesn’t meet the Howey test’s definition of an investment contract.
The dispute has been ongoing for over two years and has negatively affected the U.S. crypto market. However, the case could come to an end later this year, as the judge is expected to make a ruling in the coming months.
Ripple to Expand to Dubai
Dubai has enjoyed a growing reputation as a hub for digital assets. Several crypto projects have been attracted by the friendly regulatory structure in the region as well as the interest of locals in the industry. Ripple has now indicated its interest in setting up operations in Dubai, joining Binance and a couple of other major crypto players.
Garlinghouse shared the news at the Dubai Fintech Summit on Monday. Over 90% of Ripple’s business is conducted outside of the US, reflecting the company’s long-standing commitment to serving customers globally. Interestingly, cross-border payments from Saudi Arabia, Bahrain, India, and the UAE make up more than half of Ripple’s MENA payment volume.
Explaining Ripple’s expansion to Dubai, Garlinghouse said,
We chose Dubai as both a key office for Ripple and to bring Swell Global to the city, in large part due to its forward-thinking regulatory environment. Regulators here have risen to the challenge of establishing a framework that allows the local crypto industry to thrive, create jobs, and increase economic growth while also ensuring participants act in a responsible manner.
He added that “Dubai is playing an important part in shaping the world’s future economy. By demonstrating truly visionary leadership, the Emirate has positioned itself as an exciting fintech hub that is embracing crypto and blockchain technologies to bring innovation and foreign investment into the space.”
Ripple’s move to Dubai comes months after the region’s Virtual Assets Regulatory Authority (VARA) published its 2023 rulebook for overseeing the emerging cryptocurrency market. According to VARA, digital asset providers are required to comply with the rules, starting with getting a mandatory license. The rulebook also addresses a wide range of other cryptocurrency-related activities, such as advertising, exchanges for digital assets, and custodial services.