Ripple (XRP) on Importance of Regulatory Clarity and Uniformness in Multi-Country TransactionSeptember 8, 2020
Having the core rules of the game clear and consistent is very important in any sport. Ripple opines that a similar understanding is lacking in the blockchain and cryptocurrency space. The worry is that there is no consistent language or framework for the technology and that several financial players and companies continues to depend on outdated laws and rules.
When it comes to doing a multi-country transaction, it is important to have expensive and pre-funded accounts with the countries involved in the transaction. Despite all the funding, the time taken for the completion of the transaction can take several days to complete. And, in many cases there will be no communication about the status of the transaction.
RippleNet is here to deal with this challenge. It focuses on speeding up transactions to provide for instant settlement, thereby ensuring complete transparency and does away with the need for pre-funded accounts.
Ripple (XRP) on Regulatory Clarity from the US
The On-Demand Liquidity process makes use of the digital asset XRP as a bridge currency to make fiat currency transactions possible and to eventually deliver these benefits at scale. However, since this promise is challenging without effective frameworks and regulations in place to guide the use of digital assets, transactions are not taking place at a scale that it actually needs to.
The UK Financial Conduct Authority has been trying to provide some clarity in this regard. They have been trying to clearly define as to how companies should be regulated and how they need to be compliant.
FCA classifies tokens as either exchange tokens, utility tokens or security tokens. The use cases for each token are clearly defined. The FCA has made its regulatory perimeter very clear. Such guidelines are also very important for companies to help them decide on how they will decide to promote emerging technologies which will further lead to improvement in job gains and tax revenues.
Thus, Ripple feels that the FCA have played a role model in providing some guidelines for digital asset regulation.
Sydney Ifergan, the crypto expert tweeted: “Ripple (XRP) are hoping for US Regulations to get better in terms of digital assets as they are believing that the US is falling behind in that regard unlike the FCA.”
Ripple Insights stated, “when projects and businesses, guided by some of the best legal advice available, still find themselves unclear about the position of U.S. regulators, something is wrong. Regulation, applied consistently, should lead to predictable outcomes, not regulatory “gotchas” that kill innovation.”