Transparency is a “critical” value in the cryptocurrency industry, Ripple CEO Brad Garlinghouse noted. Speaking to Fox Business News, the executive said that clarity of operations has become even more important with the recent “collapse” of the UST stablecoin.
On May 9, UST decoupled from the dollar, causing the entire Terra (LUNA) ecosystem to crash. The crisis caused a panic among investors and many viewers wondered if other stablecoins would suffer a similar state.
Transparency is key: Garlinghouse
Garlinghouse clarified that he is not “personally involved” in major stablecoin Tether (USDT). However, he noted that the entire crypto industry could do well if it provides clarity regarding its financial frameworks. For Tether, that would assure its users that “it is, in fact, backed by dollars.”
He gave Ripple and XRP as an example of transparent players in the industry, saying that the two have gone to great lengths to be the “adult” in the financial sector.
Of note, Garlinghouse is currently attending the annual World Economic Forum in Davos-Klosters, Switzerland.
The event started on Sunday May 22nd and will last until May 26th. According to its official website, the forum hosts different world leaders to discuss the world’s status quo, as well as forge “partnerships and policies” for future use. Garlinghouse noted that he attended with the goal of sharing Ripple’s mechanisms as part of keeping it transparent.
In addition to solving “real-world problems,” the executive said that blockchain technology reduces the costs of remittances and “improves the efficiency of cross-border payments.” El Salvador cited similar reasons when adopting Bitcoin as legal tender last year.
The case of Ripple and UST
From its inception, the seemingly transparent Terra presented UST as an algorithmic stablecoin guided by the law of supply and demand. However, his shocking collapse painted an entirely different picture and tarnished his reputation in a possibly irreparable way.
Now, the cryptocurrency sector has attracted, more than ever, the scrutiny of regulators. Gary Gensler, chairman of the US Securities and Exchange Commission (SEC), recently warned investors that other crypto assets could mimic Terra’s decline. Meanwhile, the South Korean National Tax Service has imposed a $78 million tax evasion fine on Terra’s Do Kwon, despite the notorious executive refuting these claims.
On the other hand, Ripple, along with its executives Garlinghouse and Chris Larsen, continue to engage with the SEC in the year-and-a-half legal suit. In the latest proceedings, the regulator said it could neither confirm nor deny the identity of its former executive Bill Hinman in his famous 2018 securities speech.