Cory Johnson, the Chief Market Strategist for Ripple, recently appeared on an interview to speak about regulations in the cryptocurrency space. Moreover, he also spoke about the status of XRP as a security in the eyes of the United States Securities and Exchanges Commission [SEC].
XRP, as a cryptocurrency, remains in a zone of regulatory uncertainty regarding its status as a security. The declaration of the asset as a security would result in the ecosystem being more closed, as investors would find it more difficult to get into the space.
Moreover, this would throw a wrench in Ripple’s plans of using xRapid, as exchange platforms may not continue to list the coin. However, Johnson gave his two cents on the matter in an interview with CoinTelegraph:
“It’s really clear to us that XRP is not a security. XRP’s relationship to Ripple is a proof of that. But maybe more importantly, you’ve also got the XRP… You can buy all the XRP you want, it doesn’t give you the rights to a dime of the company’s profits, or earnings per share, or dividends; doesn’t give you a single share or any interest in the future of this company.”
Furthermore, he went on to say that even if Ripple, the company, was to “go away”, it would not “make a bit of difference to XRP”. This is due to the fact that the XRP ledger continues to exist separate from Ripple, stated Johnson. He went on to elaborate:
“For that reason, I think when the SEC takes a good hard look at this, and we know that they’re starting to use that work, they’re going to recognize, I suspect, that XRP is so clearly not a security.”
He also spoke about the protection of the investor, which is generally seen as the end goal of regulators in the financial space. He stated that there have been “crooks who show up” to steal money when there are new ways to make it. He stated:
“We certainly see it in everything; we saw it in atomic energy, we saw it in the oil and gas sector way back… We certainly saw it in the dot-com era, (and) we saw it in subprime financing. We’ve seen it in the world of crypto; we’ve seen these really sleazy offerings that look like they’re not actually trying to start businesses, but just separate people from their money.”
This has caused the SEC to step in, driving investor protections to emerge all around the world. However, Johnson stated that it “can’t happen fast enough”, going on to say that it makes it difficult for those who are pursuing “legitimate technological solutions” to do so.