Monica Long Highlights Challenges with SEC at Money 20/20

At the recent Money 20/20 conference, Monica Long, President of Ripple, provided a candid perspective on the regulatory challenges faced by crypto companies in the United States. In a conversation with Arjun Kharpal, Senior Correspondent for CNBC, Long delved into the complexities of navigating the U.S. regulatory landscape, particularly highlighting the role of the Securities and Exchange Commission (SEC).

The SEC’s Stance on Crypto

Long was forthright in her assessment of the SEC’s approach to the crypto industry. She remarked that the SEC does not provide a “friendly entryway” for crypto companies looking to establish themselves in the U.S. market. This sentiment echoes the broader frustration within the crypto community regarding the lack of clear and supportive regulatory frameworks in the United States.

Long pointed to the recent approvals of Bitcoin and Ethereum ETFs as significant milestones but underscored that these are just initial steps. She emphasized the necessity for more comprehensive and transparent regulations that can support the growth and integration of digital assets into the mainstream financial system.

Importance of Clear Regulations

One of the key themes of Long’s discussion was the urgent need for regulatory clarity. She highlighted the advantages of institutional decentralized finance (DeFi) in transforming basic banking transactions, including deposits, payments, lending, and credit. According to Long, blockchain technology has the potential to make financial services more global, open, and efficient, much like how the internet revolutionized communication.

She cited the European Union’s Markets in Crypto-Assets (MiCA) regulation as a prime example of a clear regulatory framework that could serve as a model for the U.S. MiCA is designed to provide a comprehensive regulatory environment for digital assets, ensuring both investor protection and market integrity.

The Debate: Private vs. Public Blockchains

Long also touched on the ongoing debate between private and public blockchains. While private blockchains are often used for technologies like central bank digital currencies (CBDCs), there have been notable advancements in public ledgers. For example, Société Générale recently issued the first euro stablecoin on a public ledger, and Ripple is set to launch a regulated U.S. dollar stablecoin. These developments highlight the growing acceptance and implementation of public blockchain solutions in the financial sector.

Addressing Fraud and Misconceptions

In light of high-profile scandals like the collapse of FTX, Long was keen to differentiate between fraudulent behavior and the inherent value of blockchain technology. She stressed that while fraud has occurred within the industry, it should not taint the perception of blockchain as a whole. The technology itself, Long argued, remains robust and capable of delivering significant benefits across various sectors.

She acknowledged that there is a “hangover” effect from such scandals, but it is crucial to separate the bad actors from the legitimate applications of blockchain technology. Long’s remarks aimed to reassure stakeholders that despite past misdeeds, the underlying technology continues to offer promising solutions for the future.

Optimism for the Future

Despite the challenges, Long expressed cautious optimism about the future of crypto regulation in the U.S. She noted that potential stablecoin legislation could be a positive step towards providing the much-needed regulatory clarity. Such legislation would help in establishing a more predictable and supportive environment for crypto companies, fostering innovation and encouraging investment in the sector.

In conclusion, Monica Long’s insights at Money 20/20 highlighted the critical need for clear and supportive regulations in the U.S. crypto market. Her call for regulatory clarity reflects a broader desire within the industry to work collaboratively with regulators to create a framework that protects investors while enabling innovation. As the crypto industry continues to evolve, the establishment of clear and fair regulations will be essential in ensuring its sustainable growth and integration into the global financial system.