XRP News – Ripple’s Chief Executive Brad Garlinghouse and RippleNet’s General Manager Asheesh Birla clarified XRP and cryptocurrencies’ position now that SWIFT banned Russia from their system.
With the recent tragedy still happening in Ukraine, the international community agreed to ban Russia from utilizing SWIFT for their cross-border transactions. Afterwards, concerns circulated about Russia using cryptocurrencies to potentially evade the sanctions.
Ripple executives outlined key arguments to refute this concern. As one of the leading cross-border payment systems utilizing cryptocurrencies for their transactions, it is understandable that Ripple would be among the first to clarify this matter.
Based on their recent statements, Brad Garlinghouse clarified that RippleNet would abide by international laws and OFAC sanctions. After this statement, he pointed out Asheesh Birla’s statement, which refuted the claims that Russia could use cryptocurrencies as an alternative.
Asheesh Birla pointed out a few key points regarding Russia’s use of cryptocurrencies.
First, he mentioned that crypto transactions are now more easily traceable by governments and different software. Second, the totality of global liquidity of cryptocurrencies is not enough to support Russia’s needs as a country. Third, the on/off ramps for these transactions are backed and regulated by financial institutions that need to abide by the OFAC laws and, by extension, the sanction.
Birla then delved deeper into the second point. He noted that Russia conducts nearly $50 billion worth of financial transactions each day. In comparison to cryptocurrencies, even Bitcoin cannot meet this volume despite its $20 billion to $50 billion transactions each day. This would mean that Russia would need to use more than just BTC, further complicating things for Russia.
However, Birla notes that Russia had ample time to prepare. He speculates that Russia could have set up direct banking relationships in Asia and elsewhere in preparation for this situation.
Regardless, other members of the crypto space are still sceptical about this response. Especially as it contradicts the company’s goal of competing with SWIFT. For now, the investors can only wait for other developments.