Ripple Labs has found itself at the center of two of the hottest topics in crypto lately: regulation and corporate culture.
Ripple has publicly implemented what it calls a “no holes” policy, in an effort to distinguish its culture among its peers, many of whom have drawn criticism for the way they treat their staff.
To Barron’s Live event examining the state of the industry right now, Financial News caught up with Sendi Young, European Head of Rippleto learn more about the company’s approach to these two topics.
Our discussion took place amid continued regulatory uncertainty in the US and UK. Firms operating in Europe should benefit from a set of clearer guidelines from the EU Crypto Asset Markets Bill, but still face a two-year implementation period.
Against this backdrop, Young struck a positive tone for the future of the sector, but said companies wanted more clarity on the rules they would face.
The global crypto regulatory landscape has evolved rapidly this year. What should happen next?
What really matters is to have a clear regulatory framework around this so that all players know the rules of the road and can innovate accordingly. Uncertainty is the greatest threat to innovation. We are not against regulation. Regulation will help crypto unlock utility.
I get to see what’s happening in the UK and Europe versus the US and Asia. I can kind of see the differences. We have outright bans like in China, we have regulation by app in the US, and we have something in between in places like the UK, Europe, Japan, Singapore, Emirates United Arab Emirates, where it’s more about creating that framework so that players can innovate. This third is certainly the approach we favor.
The Crypto Asset Markets Bill, which is the new legislation that the European Union has just passed and which is expected to come into force in the next few years, is very important. This is a pivotal moment and it is the first harmonized regulatory framework for such a large region that we have seen.
We welcome this effort. This will really help innovation and help Europe take a step towards becoming a global crypto hub.
There is currently some competition over whether the SEC or the Commodities Futures Trading Commission should regulate crypto in the United States. Which organization would you choose?
I am not in a position to say who is better placed and who would be in favor. But there are a few things that really make a good policy.
One of them is public-private cooperation. In the UK, for example, we recently held crypto sprints where the regulator invited the industry to present their views on what regulation could and should look like and what they should pay attention to.
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It’s a very good approach to understanding and considering all the nuances before coming up with something. Another thing that makes good regulation is a clear taxonomy around digital assets. Again, I’m not saying it should be one way or the other, but having clarity and knowing what you’re dealing with is the most important thing in business.
Major cryptocurrencies are still down after the crash earlier this year. What’s next for the market?
Obviously, the crypto market has been tough, but it’s not just crypto. The broader macroeconomic environment is one of the most challenging in recent decades. And over the past year, crypto markets have been more correlated with the stock market. It is therefore obviously very difficult to know whether we have reached the bottom.
But in a way, it doesn’t matter. Sure, if you’re investing in the market, you are, but the most exciting part of this industry is the fundamental shift in technology, in the underlying infrastructure, which means we can change the way whose value is displaced in the world. It’s not just money. I definitely see a world where, more and more, everything we have will be symbolized, from your art to your digital photos. Moving that around the world will be increasingly important.
Our lives have changed a lot over the past 10 years. Everything is on demand. Everything is global. Everything you want to have at the click of your fingertips. But the way we interact with the internet, money and value hasn’t really kept pace.
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You might be very disappointed when you see all this crash news, but there’s also a decent amount of money being raised for projects that create utility. Companies that focus on long-term construction continue to build. And companies like ours are still hiring. It is therefore important to also have a balanced vision. The hype is just hype. What matters is what we build, whether we solve real-world problems, and whether we bring about fundamental change in the world.
Ripple has a “no assholes” hiring policy and has sought to set itself apart from peers who have drawn criticism for the way they treat their workers. Does the crypto industry have a culture problem?
I have faced some challenges that are causing problems. One is the lack of transparency. The second problem is crypto bros. And it is real, unfortunately. With crypto being at this intersection of financial services and technology, which are two industries typically dominated by white males, there is a real threat that we could repeat the same mistakes we made in those industries.
We see it, both in our anecdotal experiences at conferences and in our recruiting efforts. A Forex study recently showed that out of the 32 largest crypto companies in the world, all CEOs are male, and in the top eight to 10 crypto companies on their boards, there isn’t even a woman. Compare that to Ripple – out of our nine board members, we have four women and other ethnicities represented as well.
Does the male-dominated nature of the industry explain why there are problems?
It’s not just that, and it’s not a binary thing. But for me, you have to be careful that we’ve seen a massive influx of talent coming into crypto from some of the major tech companies, major financial services companies. I personally come from MasterCard.
By nature, if you’re getting talent from there, there’s already a lower representation of minority groups and genders. So we need to work harder to ensure that, as the industry is in its infancy, the people working in it represent the people we are trying to serve.
Ultimately, one of the underlying premises of blockchain and crypto technology is improving access to financial services and the financial system, where today two billion people are excluded from this ecosystem, which is very archaic, created in the pre-internet era and does not meet the needs of many people on this planet.
To contact the author of this story with comments or news, email Alex Daniel