Ripple’s Chris Larsen tackles regulation and ‘fetish for disruption’

There’s “a difference between wanting to do good and not wanting to do bad.”

So said Ripple Executive Chairman and Co-Founder Chris Larsen at Money20/20 USA 2018 this week. The unchecked growth of new technology originating in Silicon Valley can often feel like a threat to portions of society, he commented.

In a fireside chat with Arjan Schütte, Founder and Managing Partner of Core Innovation Capital, Larsen said: “There is a ‘techlash’ going on, for sure. Silicon Valley has missed the boat. They’ve moved fast and broke things and didn’t worry about the consequences. This is where FinTech has struggled. Pure code is one thing, but it has to also be compliant and regulated. Technology is embedded in everything these days, and people are scared. They don’t want to hear how you’re going to break things.”

Startups and tech companies need to have more empathy, he added. Teams should think about disruption from a different perspective — one that requires them to be smart, but also thoughtful. When asked by Schütte about the impact blockchain has, Larsen acknowledged it is a disruptive technology. However, while the technology itself could disrupt, teams building on it should not.

Ripple for Good, Thorn and XRP

He cited Ripple for Good, the giving arm of Ripple, as example of the right approach to building while still being inclusive and supportive to the greater global community. Larsen said that the industry as a whole has fallen short in addressing digital assets’ potential to do harm.

There is much to learn from projects like Thorn, which uses new technology to stop the exploitation of children on the internet. This was part of digital assets “earning their way in the world,” and it was essential for new projects to make positive change by working with the traditional financial system, not disrupting it.

“Working within the system. A big part of stopping this fetish for disruption is getting involved in the industry,” Larsen remarked. “Work with banks. By working with the system, you are automatically confronted by what the concerns are. If you’re only on your own path, you don’t see what these issues are.”

Thoughtful regulation was critical to protecting consumers and seeing broader positive impacts from the technology. He believes that digital assets could help prevent the next financial crisis by solving the global liquidity problem. Larsen cited the digital asset XRP as one such example, due to its ability to provide instant transfers of value across borders without a pre-funded nostro account. The major threat to realising these benefits, Larsen argued, was overregulation.

Nonetheless, digital assets will be a driving force for positive change in the financial industry and beyond. An impact he hopes can achieve through the Ripple mission of enabling the Internet of Value, a world where money can move seamlessly across borders like information does today. Larsen believes the journey to this end goal will have a steep learning curve for digital assets and their associated projects.

He stated: “90% of what we see today [in digital assets] won’t exist in ten years’ time, but the other 10% of it will change the world.”