Ripple Exec Stresses Call for Technology-Neutral Crypto Regulations

A Ripple executive has reiterated the importance of embracing a technology-neutral approach to facilitate more adaptable and effective regulatory frameworks as global regulators encounter challenges in formulating rules for the cryptocurrency space.

During the recent Ripple Swell 2023 event, Navin Gupta, the managing director of South Asia, Middle East, and North Africa at Ripple, emphasized the significance of regulating the industry based on activities rather than specific technologies. Gupta stated that the focus should be on regulating the purpose and use of virtual assets, rather than the underlying technology, to create dynamic regulations that can evolve alongside blockchain technology.

Regulatory Emphasis on Activity Over Technology

Gupta highlighted the need for a shift towards regulating cryptocurrency activities based on their specific functions, such as payments or securities, rather than prescribing regulations based on the technology facilitating these activities. He advocated for a technology-neutral regulatory approach, underscoring the importance of flexible regulations that can adapt to the evolving blockchain landscape.

The unique characteristics and global portability of cryptocurrencies, coupled with their diverse token types, have presented a significant challenge for regulators worldwide. As a response, the Group of Twenty (G20) unanimously embraced a crypto regulatory roadmap in October, which had been proposed by the International Monetary Fund and the Financial Stability Board in September. This initiative calls for comprehensive oversight of the cryptocurrency sector on a global scale.

Regulatory Challenges in the Middle East and North Africa

While certain jurisdictions in the Middle East and North Africa, such as the United Arab Emirates, have adopted an open approach toward cryptocurrencies, others, including Saudi Arabia, Egypt, and Morocco, have either not established clear regulations or have imposed outright bans on Bitcoin (BTC) and other cryptocurrencies.

Gupta emphasized the necessity of educating and collaborating with regulators to enhance their understanding of the crypto industry. He also stressed the importance of introducing non-speculative use cases for cryptocurrencies, such as crypto remittances and payments, as a pivotal strategy for navigating the diverse legal landscapes within the region.

Educational Efforts and Utility-Based Projects

Gupta reiterated the potential of non-speculative crypto use cases, emphasizing their ability to garner regulatory interest by focusing on how cryptocurrencies can facilitate real, tangible benefits for citizens, rather than speculative gains. He emphasized that education and the implementation of utility-based projects, demonstrating genuine utility for users, are crucial for garnering support from regulators.

Given the substantial remittance market in Africa, Ripple unveiled a partnership with mobile payments provider Onafriq in November. This collaboration aims to establish new payment corridors between 27 African countries and Australia, the United Kingdom, and the Gulf Cooperation Council.

Conclusion

The growing dialogue about technology-neutral regulation in the crypto space underscores the industry’s evolving dynamics and the need for regulatory frameworks that can adapt to these changes. Embracing a technology-neutral approach can facilitate the creation of adaptable and effective crypto regulations, ensuring that they remain relevant amidst ongoing developments in blockchain technology.

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