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A U.S. administration change will not roll back the positive regulatory strides that the cryptocurrency industry has enjoyed in President Donald Trump‘s second term, Ripple CEO Brad Garlinghouse says.
“I don’t think we will go back to that,” Garlinghouse said on Oct. 15 at D.C. Fintech Week, referring to the hurdles faced by the cryptocurrency industry under the Biden administration with Gary Gensler at the helm of the Securities and Exchange Commission. “Frankly, I think the ship has sailed. I think that you can’t put the genie back in the bottle in the United States.”
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Garlinghouse said that some banks were reaching out to Ripple to collaborate on stablecoins following the enactment of the GENIUS Act. Still, he said that some more conservative institutions were choosing to remain on the sidelines until Congress passed comprehensive cryptocurrency market structure legislation. He said these institutions were scared the cryptocurrency industry’s regulatory tailwinds would be disrupted under another administration.
“I think that’s a little bit too cautionary, because I think every day that goes by, even without the CLARITY Act in place, there’s more and more firm policy positions that agencies are taking,” Garlinghouse said, referring to the anticipated cryptocurrency market structure legislation.
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Under the Biden administration, Gensler spearheaded a crackdown on the cryptocurrency industry. During Gensler’s tenure, the SEC filed 125 cryptocurrency-related enforcement actions alleging that several companies and projects violated securities laws. The enforcement-laden approach sparked industry criticism. Industry leaders said that it was unclear how decades-old securities laws applied to cryptocurrencies and there was no clear path to compliance.
Ripple was on the receiving end of one such enforcement action alleging that its sale of the cryptocurrency XRP represented an unregistered securities offering. However, the charges against Ripple were brought at the end of the previous Trump administration, just before Gensler took office.
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Still, it was Gensler’s SEC that prosecuted the case, taking the position that XRP was an unregistered security. A federal judge in July 2023 ruled in favor of the SEC on Ripple’s direct XRP sales to institutions but said the firm’s secondary-market sales to retail investors did not constitute a securities offering. The judge hit Ripple with a $125 million fine and an injunction against future sales of XRP to institutions.
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