Ripple (XRP) Isn’t a Security, Sagar Sarbhai Claimed

3 min read

Sagar Sarbhai, an important leader at Ripple revealed some interesting information about the common narrative within the crypto industry in the 21st century.

Head of government and regulatory relations (APAC and Middle East) at blockchain-based company Ripple– Sagar Sarbhai, claimed today for CNBC that the common narrative within the cryptocurrency ecosystem has now a different structure.

Sarbhai claimed:

“A couple of years ago, the narrative was ‘blockchain good, crypto bad.’ But I think what we’re now seeing … [more] policymakers and regulators are [realizing] that there is a strong benefit that digital assets and cryptocurrencies bring in.”

Ripple hopes to kick the crypto market with the new product

Speaking of different methods of use of crypto assets as well as tech details, the leader noted: “So, for example, [promoting] financial inclusion and lowering barriers to commerce.”

Asked on what motivated the Californian crypto project to go live roughly five years ago, Sarbhai elaborated that:

“Ripple started … as a software enterprise company, and our flagship product is called xCurrent …We have around 120+ banks using the software, [which] can lead to real-time payments seamlessly, and very, very cheaply.”

He went on stating that:

“Our next product is called xRapid that uses a digital asset called XRP and that really is a mechanism to source liquidity in real-time…we [are expecting] some good news soon … when we launch the product.”

Sarbhai admitted that the xCurrent product was simply integrated, bearing in mind that it does not involve a cryptocurrency behind the tech program. On the other hand, the second product dubbed xRapid faced several regulatory challenges, “but that was more of the case [or issue] a year ago.”

“Thailand has come up with sophisticated crypto frameworks to help … banks and [other] financial institutions, payment providers [to] leverage the power of digital assets for payments,” Sarbhai added.

Reasons why XRP isn’t considered a security

Here are three reasons why Ripple’s XRP isn’t considered a security, according to Sagar Sarbhai:

  1. “… if an investor buys XRP, you do not get a stake in the company [as] dividends are not paid out by Ripple, the company.”
  2. “Number two, Ripple and XRP are two different things (or distinct/separate entities). So, tomorrow let’s say for whatever reason Ripple, the company, goes away, the XRP ledger will still stay. XRP ledger is open-source. Anyone can use it. You and I can use it.”
  3. “The XRP ledger uses a consensus mechanism [that requires] validators …it’s an open-source software… there are around 150 validators today out of which the Ripple company only owns around 10.”

 Author: Adriana Midrigan

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