Cryptocurrency and blockchain company Ripple expects a decision in a US Securities and Exchange Commission lawsuit to come in the next three to six months.
The SEC initiated a lawsuit against Ripple in 2020, alleging that the company illegally sold XRP — a cryptocurrency created in 2012 — to investors without first registering it as a security.
The company has spent $200 million defending itself against the SEC lawsuit, Brad Garlinghouse, chief executive of Ripple, told the Dubai FinTech Summit on Monday.
Ripple disputes the claim, saying that the token should not be considered an investment contract and is used in its business to arrange cross-border transactions between banks and other financial institutions.
“But even after the lawsuit, the US needs to provide clear rules of the road and regulatory clarity. The lawsuit will help. Other countries around the world will be ahead of where the US is in adopting blockchain technologies,” Mr Garlinghouse told The National.
“If we win the lawsuit, it’ll be clear what XRP is, but the rest of the industry is still going to be unclear. And the whole crypto industry needs regulatory clarity in the US to really thrive.”
XRP was once the third-largest cryptocurrency, commanding a market value of $120 billion in early 2018.
Its value has dropped sharply since then, amid the US regulatory scrutiny and a wider downturn in Bitcoin and other digital currencies.
XRP now has a market capitalisation of about $23.9 billion, according to CoinMarketCap data. The token peaked at $3.84 in January 2018. On Monday, it was trading at $0.44.
The past 12 months has been volatile for the global cryptocurrency sector, which is only now emerging from a “crypto winter” after the collapse of a number of large platforms such as Celsius, Three Arrows Capital and Sam Bankman-Fried's FTX, which filed for bankruptcy in the US on November 11.
“One of the silver linings for Ripple is we’re at the end of our journey [in terms of the regulatory lawsuit]. We’re two and a half years into this lawsuit. We should have a decision pretty soon,” Mr Garlinghouse said.
“Some of these other companies are beginning their journey, and it’s expensive and a distraction. It makes it harder to grow your business in the largest economy in the world ... I’d rather see clarity for the whole industry.”
Most leading US-based cryptocurrency companies are investing more outside the country than within right now, he said, adding that without regulatory clarity, there would either be lawsuits or the threat of lawsuits against them.
He praised the UAE and Dubai’s Virtual Assets Regulatory Authority for being role models for its framework governing digital assets.
Meanwhile, Mr Garlinghouse said Dubai, Singapore and Switzerland will emerge as global financial capitals in the next 10 to 20 years due to their regulatory clarity.
He described them as progressive not only in protecting consumers but in also allowing innovation.
“That is critical and we haven’t seen that in some jurisdictions like the US,” he said.
The Mena region accounts for a fifth of Ripple’s global customer base. South-east Asia is also another growth market for the company, which has 90 per cent of its business outside the US, Mr Garlinghouse said.
Ripple will expand its presence in Dubai by opening a new office in the Dubai International Financial Centre in six months.
In 2020, the company chose the DIFC as the location for its Mena headquarters.
“We chose Dubai as a key office for Ripple, in large part due to its forward-thinking regulatory environment,” Mr Garlinghouse said.
“Regulators here have risen to the challenge of establishing a framework that allows the local crypto industry to thrive, create jobs and increase economic growth, while also ensuring participants act in a responsible manner.”
Ripple hired more than 300 people globally last year amid layoffs in the wider crypto industry.
The growth of customer activity in the UAE is reflected in employee activity. Ripple is hiring more people in Dubai while employees from other markets are also relocating here, he said.
Even after the lawsuit, the US needs to provide clear rules of the road and regulatory clarity
Brad Garlinghouse,
chief executive of Ripple
Besides major regional banks leaning into Ripple’s technology, it has also signed up smaller players such as Pyypl, a FinTech that is building remittance-based solutions to lower costs and speed up transactions, he said.
Mr Garlinghouse said he was “very bullish” about the cryptocurrency industry in the long term because it was being increasingly used to focus on utility and solving real problems.
“There's definitely speculation that's part of the market today. In the short term, you have the unknowns around regulation,” he said.
“In the long term, those are just speed bumps. What you have seen over the 10-plus years that the crypto industry has existed, you've seen many speed bumps such as FTX and Terra Luna, and some of these are more than speed bumps.
“But the fact that you're still seeing the industry do well in some ways, despite all these challenges, reflects its resilience.”
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sept 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
KILLING OF QASSEM SULEIMANI
Europe’s rearming plan
- Suspend strict budget rules to allow member countries to step up defence spending
- Create new "instrument" providing €150 billion of loans to member countries for defence investment
- Use the existing EU budget to direct more funds towards defence-related investment
- Engage the bloc's European Investment Bank to drop limits on lending to defence firms
- Create a savings and investments union to help companies access capital
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Tips from the expert
Dobromir Radichkov, chief data officer at dubizzle and Bayut, offers a few tips for UAE residents looking to earn some cash from pre-loved items.
- Sellers should focus on providing high-quality used goods at attractive prices to buyers.
- It’s important to use clear and appealing photos, with catchy titles and detailed descriptions to capture the attention of prospective buyers.
- Try to advertise a realistic price to attract buyers looking for good deals, especially in the current environment where consumers are significantly more price-sensitive.
- Be creative and look around your home for valuable items that you no longer need but might be useful to others.
Emergency phone numbers in the UAE
Estijaba – 8001717 – number to call to request coronavirus testing
Ministry of Health and Prevention – 80011111
Dubai Health Authority – 800342 – The number to book a free video or voice consultation with a doctor or connect to a local health centre
Emirates airline – 600555555
Etihad Airways – 600555666
Ambulance – 998
Knowledge and Human Development Authority – 8005432 ext. 4 for Covid-19 queries
The specs: 2017 Lotus Evora Sport 410
Price, base / as tested Dh395,000 / Dh420,000
Engine 3.5L V6
Transmission Six-speed manual
Power 410hp @ 7,000rpm
Torque 420Nm @ 3,500rpm
Fuel economy, combined 9.7L / 100km
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
Read more from Kareem Shaheen
Leap of Faith
Michael J Mazarr
Public Affairs
Dh67
Navdeep Suri, India's Ambassador to the UAE
There has been a longstanding need from the Indian community to have a religious premises where they can practise their beliefs. Currently there is a very, very small temple in Bur Dubai and the community has outgrown this. So this will be a major temple and open to all denominations and a place should reflect India’s diversity.
It fits so well into the UAE’s own commitment to tolerance and pluralism and coming in the year of tolerance gives it that extra dimension.
What we will see on April 20 is the foundation ceremony and we expect a pretty broad cross section of the Indian community to be present, both from the UAE and abroad. The Hindu group that is building the temple will have their holiest leader attending – and we expect very senior representation from the leadership of the UAE.
When the designs were taken to the leadership, there were two clear options. There was a New Jersey model with a rectangular structure with the temple recessed inside so it was not too visible from the outside and another was the Neasden temple in London with the spires in its classical shape. And they said: look we said we wanted a temple so it should look like a temple. So this should be a classical style temple in all its glory.
It is beautifully located - 30 minutes outside of Abu Dhabi and barely 45 minutes to Dubai so it serves the needs of both communities.
This is going to be the big temple where I expect people to come from across the country at major festivals and occasions.
It is hugely important – it will take a couple of years to complete given the scale. It is going to be remarkable and will contribute something not just to the landscape in terms of visual architecture but also to the ethos. Here will be a real representation of UAE’s pluralism.
Brief scores:
Toss: Nepal, chose to field
UAE 153-6: Shaiman (59), Usman (30); Regmi 2-23
Nepal 132-7: Jora 53 not out; Zahoor 2-17
Result: UAE won by 21 runs
Series: UAE lead 1-0
Result
Crystal Palace 0 Manchester City 2
Man City: Jesus (39), David Silva (41)
German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
