In the past few weeks, Ripple has put considerable effort into bolstering its global regulatory team with the explicit intent to help educate policymakers on the crypto space as a whole.
Ripple recently expanded its global regulatory team with the establishment of the first dedicated GR office in Washington D.C. by any major blockchain company. Ripple also announced the addition of Craig Phillips to the Ripple’s Board of directors. Phillips was a “former Counselor to the Secretary at the U.S. Treasury Department.” Ripple’s regulatory expansion also included Susan Friedman as International Policy Counsel and Ron Hammond as manager of government relations.
This regulatory push was preceded by statements from Brad Garlinghouse when he appeared on the podcast titled Off the Chain with Anthony Pompliano:
“We live in a world of governments, that’s not going to change anytime soon.”
“What Ben Bernanke was saying, which I subscribe to, if you’re talking about G20 markets, to give up the ability for them to control their money supply is giving up their sovereignty. They’re gonna bring out the tanks before they give up their sovereignty. His point was basically, if what you are doing is threatening the sovereignty of a nation, that is a very high attack on a nation and they’re going to fight that aggressively.” … “They’re [the G20] not going to sit idly by and have their fiat and their ability to control monetary policy be disrupted.”
Ripple also formally joined the Blockchain Association, which is a group dedicated to working with and educating policymakers on blockchain and digital asset technologies.
UBRI Connect 2019:
UBRI stands for the University Blockchain Research initiative. It is a collaboration between Ripple and Universities around the world to support a variety of blockchain and fintech initiatives.
Ripple indicates that during the event their Global Head of Government Relations, Michelle Bond led a talk with Kristin Smith, the director of the Blockchain Association about legislative developments and the importance of working with and educating policymakers:
“Yet, as Smith discusses, “when a new transformative technology comes along, it takes time for the regulations to keep pace.” In the U.S. and abroad, it’s important for policymakers to be armed with industry knowledge to help them shape conditions that will enable technological innovation to thrive. The mission of the Blockchain Association and its members, which includes Ripple, is to be a unified voice of the blockchain industry and to educate and collaborate with policymakers to advance trust, transparency and safety of distributed technologies and services.”
Regulators are often not technologically inclined. Some might remember the statement describing the internet as a “series of tubes” by Senator Ted Stevens. Part of the reason for these odd statements is that it can take a lifetime to accrue an understanding by policymakers of our legal frameworks, governance traditions, and any other aspect of legislation or governance. This is at odds with the rapid, transformative, and exponential growth that we see with new technologies. Technically sophisticated individuals also, unfortunately, tend to be so odd that they’re unelectable.
Politics and technology are distinct fields that often clash together as new technologies begin to push boundaries and open up new possibilities that our laws either don’t have an existing framework to draw upon or a legal framework exists that is out of date or overly restrictive given the nature of a new technology. Often the birth, development, and use of new technology like XRP outpaces an institution’s ability to field the requisite experts that both understand the law and technology well enough to craft desirable legislation. Legislators are vulnerable to disinformation, and Ripple’s new push towards educating and collaborating with policymakers is aimed at informing Senators and members of the House and inoculating them against overly simplistic statements that attempt to paint the whole cryptospace as a medium of exchange for drug dealers and criminals.
From the UBRI Connect summary released by Ripple:
“In conversations, policymakers express concern stemming from a lack of understanding. “But once you educate and get to the point of clarity, there is increased interest in trying to find the right public policy solutions in order to fix today’s problems,” says Smith.”
The hope is to prevent less technically inclined regulators from falling into crypto’s own version of the “series of tubes” statements. We saw some of this with the grilling of mark Zuckerberg in Congress by Democratic Representative Brad Sherman when he stated: “You’re trying to help those for whom the dollar is not a good currency – drug dealers, terrorists, tax evaders.”
The entirety of Representative Sherman’s statement is found between 1:00:56-1:06:11 in the above video.
Considering Garlinghouse’s earlier statements about sovereignty, it also likely that Ripple intends to make the argument to policymakers that not all in the cryptocurrency ecosystem want to supplant national currency and monetary policy, and that companies like Ripple plan to work within the existing global framework. Hopefully, a push towards educating lawmakers will make statements like Senator Sherman’s less common and will enable Congress to pass laws that allow companies like Ripple and cryptocurrencies like XRP, BTC, and ETH to flourish in the United States absent unnecessary regulatory hurdles and false statements by legislators that cryptocurrencies are dominated solely by illicit activities.
Header image by Bob Bowie