The price of Ripple’s XRP cryptocurrency keeps tumbling, having lost more than half of its value in less than a week.
But relax, it’s all part of the first steps in a whole new form of finance, says Ripple CEO Brad Garlinghouse, who recently had some words for Bitcoin and the other digital currencies that continue to think they’re at war with traditional banking.
The mercurial rise of XRP over the past month was a sight to behold, hitting the $1 (USD) mark near the end of December before crashing through both $2 and $3 dollars within a week — only to pull back to Earth over the last few days. The drop is not a problem, says Garlinghouse, who spoke to Fox Business Network to reiterate that, all things considered, XRP is still up by over 1,000 per cent over the year.
“There’s a lot of volatility in the digital asset market broadly,” says Garlinghouse, “and certainly that’s been true in the bitcoin market and it’s true for XRP.”
“The market is very nascent, it’s still the earliest innings of the creation of a new asset category,” says Garlinghouse, who took over CEO duties at Ripple from co-founder Chris Larsen a little over a year ago. “That category is about real utility, about solving real problems. For Ripple, that’s using XRP to solve the global payments problem.”
Opinions differ as to what’s behind the drop in XRP’s value, with some cryptocurrency observers maintaining that a correction was in order and that the token, which briefly took over Ethereum’s spot as second-most valuable digital currency, hitting a market value of $86 billion at one point (in comparison to bitcoin’s roughly $250 billion market cap).
Others point to the popular currency site, CoinMarketCap, which on Monday listed currencies without data from South Korean exchanges, where digital currencies are heavily traded. That omission made bitcoin and XRP look less valuable and caused a spate of panic selling.
Either way, XRP appears to be staying in the mix as a legitimate contender to potentially upset bitcoin as top cryptocurrency. Garlinghouse says it’s Ripple’s approach to revolutionizing the financial world that sets it apart.
From the beginning, much of the language surrounding blockchain technology and the cryptocurrencies it has helped establish has been about replacing banks and regulations with a more decentralized, fluid system of value transfer. And while Garlinghouse does see Ripple as disruptive within the space, its take is more about working with established financial institutions instead of trying to tear them down. He stated that already Ripple is partnering with three of the top five corporations that handle cross-border payments.
“Having thoughtful regulation and working with governments, we’re going to keep working with the system, because I think the early days of bitcoin were about ‘down with government’ and ‘down with banks,’” says Garlinghouse. “Government is not going away, banks are not going away, so let’s work with the system to dramatically improve the way money moves globally.”
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