Ripple CEO Brad Garlinghouse spoke in an interview with Kara Swisher’s Recode Decode podcast on May 20th: the banking giant has good reason to accept innovation in the encryption industry, despite its apparent threat to the current oligopoly.
Throughout the interview, Garlinghouse emphasized that Ripple’s approach is to work with financial institutions and regulators; to cooperate, not to violate system systems. He believes that given the concerns of global regulators about money laundering and terrorist financing, the idea of bypassing the government and other authorities for anonymous transactions will not prevail.
Instead, the CEO is openly controversial in the field of encryption. He said: “I don’t think banks…the government will disappear, and banks provide a regulatory framework that is important to society. I personally believe that banks will continue to serve this. A role, they are good at it. Banks will benefit from this series of new technologies and develop from them.”
Among the advantages and possible resistances at the intersection of the Crypto field and traditional finance, Garlinghouse emphasized that banks are part of the solution.
Given that XRP and Ripple’s technology is designed to significantly reduce the cost of remittances for cross-border value transfers, the CEO noted that regional banks and so-called Tier 1 currency center banks (for these technologies) may react differently.
For regional banks, for example, Wells Fargo, he noted that the efficiency provided by blockchains and cryptocurrencies has clearly provided them with an incentive to accept them from the outset. He said: “99% of banks love what we are doing because we are democratizing things in a very small number of banks – their competitors.”
Garlinghouse acknowledges that the current oligopoly control of banks at the First Class Center will be threatened by new technology and capital flows. According to reports, Citibank earned about $8 billion from other banks last year.
However, Garlinghouse asserts that even the largest banks may be forced to adopt these technologies because cryptographic transactions that conform to the KYC standard do significantly reduce remittance costs and resistance, in order to prevent company giants like Amazon from taking the lead.
According to reports, Bank of America giant JP Morgan Chase announced that it will launch its own blockchain-based internal settlement digital assets called “JPM Coin” this fall.