Ripple focuses on the need to regulate the blockchain, noting that this will provide an opportunity to achieve economic growth. Proper regulation, as Ripple representatives have repeatedly emphasized, will help realize the potential of the crypto industry. Regulatory frameworks are important for the blockchain, as Ripple notes, as they create the right background and allow for effective development. In a new article on the official website, Ripple talked about one of the systems for regulating the blockchain, namely BitLicense.
Ripple focuses on the need to regulate the blockchain: Details
Ripple focuses on the need to regulate the blockchain in a new article, talking about the BitLicense system. According to Ripple, the BitLicense system was introduced in 2014 by Benjamin Lousky, the then head of financial services in New York State. Lousky is currently the head of the Ripple Board of Directors.
BitLicense is a generic term used to describe New York’s business licenses for digital asset management companies. BitLicense defines what a digital asset business is and sets out specific work requirements. During the Ripple Swell 2019 conference, Lousky, along with Ripple’s legal adviser Stuart Alderoti, discussed the origin and structure of BitLicense, as well as how this experience can help develop a future regulatory framework. When the specified then was just created, there were no precedents for the regulation of digital assets.
The head of the board of directors of Ripple emphasized that the laws of New York, written in ancient times, were applied there. In addition, the Lowski team understood that the blockchain was at a crossroads to a certain extent. Fintech was a world of innovation that led to a great flourishing. However, as the head of the Ripple board of directors pointed out, there was no regulation there. The world of financial technology, which has no norms, competed with the world of financial services, where there were plenty of norms. The BitLicense system had some success, although it was not perfect.
However, as Ripple emphasizes in the article, Louski also wanted to create a certain basis, which, during development, would provide confidence that companies with a license have sufficient capital, means of controlling cybersecurity and protecting consumer rights. As Lousky explained, having BitLicense is a competitive advantage because of the confidence it signals to investors, partners, and customers.
According to Ripple, Louski is now surprised that American regulators do not currently have such systems. He hopes that over the year such systems will still be added to the world. The head of the board of directors of Ripple also noted Singapore’s aspirations in this regard. In his opinion, what is interesting for Singapore is that you can create many separate licenses, including for small companies, which is more economical. In the future, the representative of Ripple expects the adoption of new regulations regarding blockchain in the US states, which in the end will be useful for the whole country.