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Navigating the future of crypto policy and innovation with Ripple's Lauren Belive

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On this week's episode of What's at Stake, Penta Partner Bryan DeAngelis and Managing Director Elliott Owensby sat down with Ripple's Head of U.S. Public Policy Lauren Belive to discuss all things crypto including Ripple's legal victory against the SEC and the company's recent announcement that it plans to launch a stablecoin later this year. 

Throughout the discussion, Lauren underscored the importance of crafting clear rules of the road for crypto in the U.S. To help bring that vision to reality, Bryan, Elliott, and Lauren discussed the role of crypto in the 2024 U.S. elections and how they hope their involvement with the crypto PAC Fairshake can make a difference during this pivotal election cycle for the industry. 

Check out the new episode now!

Speaker 1:

Welcome to a new episode of what's at Stake, a Penta podcast. I'm your host, brian DeAngelis, a partner here at Penta, and today I'm joined by my colleague, elliot Owensby. We're teaming back up for another crypto episode. Elliot's one of our managing directors, based out in San Francisco, and we've got a great special guest, lauren Believe, ripple's head of US public policy. Through blockchain technology, ripple works to unlock greater economic opportunity for everyone everywhere, and we'll dig into that a little bit more. But Ripple's work enables global financial institutions, businesses, governments and developers to move, manage and tokenize value. So we're excited to have Lauren here today to speak with us, tell us more about Ripple's policy engagement efforts in Washington DC and how everything's going with crypto heading into kind of the end of the year, the second half of the year. So, lauren, thanks so much for being here with us today. Thanks for having me. Let's start. Just tell us a little bit about yourself. You've had a great career here in DC and I'm always curious to start with our guests of what led you to where you are today.

Speaker 2:

Well, thank you. I guess the thesis of me is that I truly believe in crafting smart regulations. I started the first 10 years of my career on Capitol Hill and the Obama White House and then wanted to continue to make an impact on people's lives, and that brought me into the tech industry where I founded the Lyft DC office and ran federal operations there. During the peak of the pandemic I moved to Zoom to build out the US government relations team there and then pivoted to SoftBank, which really drove innovation, and I've been at Ripple. I started there last year and it has been just a really incredible experience so far to go into another industry where there has been no pen to paper on good regulations and looking to craft and set the standards for the industry that's great.

Speaker 3:

I'd be curious, lauren, for listeners who may not be as familiar with Ripple and what the company is trying to solve. Brian touched on it, but I always think it's in your words how do you think about the task at hand and the mission of the business?

Speaker 2:

Well, that's a great question, and our mission is that Ripple works to enable the world to move money, like information, and help create the internet of value. I think the core problem that we're solving for is it's crazy that we can stream a video from the space station, but we can't send money in real time globally. Today, the fastest way to do this is to bring $10,000 on an airplane strapped to your person, and we want to make that as seamless, as transparent, as safe and as easy and as affordable as possible.

Speaker 1:

It is wild when you think about all the disruptions that's been happening over the last 10 or so years and this is sort of the one piece of the global economy that's still so ripe for disruption.

Speaker 2:

Exactly, and you think about where we fit into the cryptocurrency industry equation. Ripple is a business to business enterprise. Our clients are financial institutions, small to mediumsized enterprises, corporations, national governments, and for us it really is about moving fiat, moving real money, and we use the cryptocurrency technology, the digital asset technology, to be able to facilitate this instantaneous global cross-border payment. So it's really enhancing your traditional finance technology really enhancing your traditional finance technology.

Speaker 3:

I love the space station example because on one hand, it's such a vivid reminder of some of the difficulties but on the other hand, it is legitimately something that a lot of the you know, ripple enabled tech stack could pull off. I mean it's like it's kind of astounding to consider that that is very much within the realm of possibility. This isn't a Jetsons bank. I mean, this is something that you could meaningfully pull off with the existing tech stack. I think it's just such a powerful example when you think about the possibilities of some of this stuff.

Speaker 2:

Well, absolutely, and the thing to think about, too, is every single human in this world needs to operate with commerce, so this could have a direct effect to help make the world flat, to enhance globalization and to ensure that people have a more seamless way of conducting their technological advancements.

Speaker 3:

We don't often break a lot of news here on the PentaPod, but can I go ahead and add Mars to that list? Lauren, when we get there, are we going to be able to move money from Mars as well, if we?

Speaker 2:

have a good blockchain and internet connection. I think we got to talk to the FCC and some broadband there, but if we can get there, then we can send money there, absolutely All right.

Speaker 1:

We've had some conversations about Ripple on the podcast in the past, so to say that the last few years have been pretty significant for the company, I guess would be an understatement. Lauren, it's been busy. Can you briefly walk us through what happened with the SEC's lawsuit and share a little bit about where things stand now?

Speaker 2:

Excellent, well and busy is why I joined this company. Back in 2020, at the end of the Trump administration, the SEC sued Ripple, claiming that XRP the token that Ripple leverages in its products was a security. But after years of lawsuits, fighting, a lot of money, a lot of time and resources, ripple finally had a huge victory. Ripple finally had a huge victory In July of 2023,. It was a huge month for Ripple and for the crypto industry at large in the US, because the court sided with us on the main question in the SEC's lawsuit that XRP is not, within itself, a security, and it's that kind of legal clarity that is really rare in the cryptocurrency industry. To date, xrp and Bitcoin are the only two crypto tokens that have that honor, and that's monumental, truly monumental.

Speaker 1:

It is, you know. I really want to emphasize that point because we wake up every day to the SEC looking at another lawsuit against a crypto company or involved in some kind of action, and it really is just. Xrp and Bitcoin are the only two that have been given this legal clarity and that opens up a lot of possibilities. We've already seen it with Bitcoin, with the ETFs and all that work, but certainly now for XRP and the work you all are doing too.

Speaker 2:

Well, absolutely, and I think in this scenario, a rising tide lifts all ships and, for us, we're focused on ensuring that the rest of the road, so that there could be a true legal framework and that will put an end to all the SEC uncertainty and allow for the blockchain economy to reach its full potential.

Speaker 1:

I want to get into congressional stuff more in a minute, but I think Elliot's dying to ask you about the announcement a couple weeks ago.

Speaker 3:

I mean I got it. Yeah, we've buried the lead long enough. And I mean, obviously, you know, I feel like so many things at Ripple like the hits don't stop. I mean a couple weeks ago you all announced you'll be launching a stable coin here in the near future. You know, how do you think about that specific new product, lauren, in the context of the stablecoin? You know economy and the benefits there and how does it fit into, you know, kind of the broader picture as you touched on, you know, with enabling commerce and transactions?

Speaker 2:

Yeah, no, this is absolutely thrilling, you know, in terms of taking a step back. Ripple has enabled the crypto solutions for businesses around the world. We are in 67 countries. We've launched payment systems and pilots from Brazil, south Korea, palau, and you have to really think about what that means for the general globalization of the world.

Speaker 2:

The next step is stablecoin, and we are really excited about this launch. We keep hearing from our customers this is a customer demand that they want a common dollarized method of transaction, and it's why that is widely available and always on, and so we hope that this will be the right fit for our existing business channels and there's so much opportunity here. Today, the stablecoin market is about $150 billion and we have not entered that market yet, and we expect this market to exceed nearly $3 trillion by 2028. That was independent research that was done, research that was done, and I think that clear demand is showcasing that the trust, stability and utility from a company that is compliance first, which Ripple is, would be an ideal player, and we're looking to have this pegged to both the XRP ledger and the Ethereum networks.

Speaker 1:

And tell us more about where that syncs up with the government you know, and where are there kind of partnership opportunities for you all with government on moving stable coins forward?

Speaker 2:

Yeah, well, currently we are working very closely with the New York DFS and that's a focus for us and we are complying with all current law, both mostly through the state level. But what's very exciting is, as we speak, the Congress is negotiating a stablecoin bill between Chairman McHenry and Ranking Member Waters. I know the Senate is involved, the Treasury is involved, the New York Fed is involved, as is the state, and so that's something that could really set a great pathway hopefully for both state pathways to have jurisdiction over this as well as having a federal oversight, and then we would be able to have the regulatory clarity not only to operate in the country but also to identify really good US banking partners and have that business relationship and the security around that business relationship that we want to pursue.

Speaker 1:

And is the same thing happening globally for you all as well?

Speaker 2:

Yes, yes, it's definitely a global market and we're seeing actions, you know, across the board, both in the EU, UK, Singapore, and so this is something that that we can see start in the US with our launch and expand across the globe.

Speaker 1:

So it seems like it's pretty exciting time for Ripple and certainly a lot more to come in the next couple of years. But with that, why don't we take a quick break? And I do want to come back and then hear more about how Ripple is feeling, maybe in the medium term, about the upcoming election and what's going on with Congress and how that could affect the regulatory policy. So we'll be right back on what's at State.

Speaker 2:

Beautiful, thank you.

Speaker 4:

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Speaker 1:

Welcome back to what's at Stake. Let's jump right back into it with our guest, Lauren Believe of Ripple. So, Lauren, we've talked about Ripple's lawsuit and the big victory last year. We've talked about the recent news that you all announced around stable coins. Can you fill us in a bit on how you and the company are feeling about the state of the crypto industry and I'm sitting here in DC so I'm particularly interested in how you're feeling about it leading into the run-up of the 2024 election.

Speaker 2:

Absolutely Well. Let's start by level setting. Ripple has said that the upcoming elections are the most consequential in the history of crypto and the 52 million Americans who own and use this technology. We know that the election represents a pivotal moment for grassroots efforts to advocate for innovation and responsible regulation in our industry and to level set. We don't feel like the future of the crypto industry hinges on a Democratic candidate winning or a Republican candidate winning. Innovation, alongside responsible compliance, first mindsets, should be a bipartisan objective for the United States. Full stop period, because this technology is here. It's not going back into the box. There needs to be rules of the road and regulations written by Congress so that the American people can have the certainty in the products that they're using. Fairshake, the PAC supported by Ripple, will play a crucial role by providing the resources necessary to make that happen.

Speaker 3:

And Lauren, that's exactly I wanted to ask you about Fairshake because you know, obviously it was a really exciting development, I think, for folks that are watching the crypto industry broadly, to see, you know, such an important investment and really, you know, the industry coming together to begin to actively, you know, participate in the process in 2024. I'd be curious, you know, hear a little more from you on Fairshake and sort of how you see that playing a role going into the 2024 election.

Speaker 2:

Thanks, Elliot. So Fairshake is a super PAC made up of contributions from crypto industry leaders, including Ripple. We hope that this funding that will help us get one step closer to electing members who understand technology, understand the impact that it has on constituents and understand why legal guidelines are very important for technology to have the operation abilities. With clear regulatory and legal frameworks, it encourages responsible innovation and will allow the blockchain economy to hopefully realize its full potential.

Speaker 1:

And tell us more. So you know this is pretty common. If you take a big step back, I mean, you see a lot of PACs engage. They're pushing for their particular industry's. You know, regulatory agenda, congressional agenda I feel like Fairshake's getting a lot of attention because it's crypto and it's new and it hasn't done it before. But you know, the future of the industry is kind of very up in the mix as we haven't seen Congress actually act yet. So tell us more about, kind of, how you're thinking of it there.

Speaker 2:

It's essential to recognize the future of the crypto industry isn't contingent on the victory of a particular political party. What's at stake is the education of members of Congress on exactly what the technology does, how it fits into the precedent of existing financial regulations and how it can be enhanced to really facilitate better access and better legal structures with clear operation consistency across the board. I think the key question remains are we going to elect representatives who prioritize establishing a well-defined regulatory framework that will allow the crypto industry to thrive?

Speaker 1:

And I can jump in there. What I feel is so interesting here is that we haven't done that yet. We haven't connected the kind of grassroots, the 52 million Americans that are interested in this with you know their congressional leaders and kind of telling them more about what they want and what they are pushing, and making those candidates, those members, start to think about this as a priority. Instead, we've had this regulation by enforcement, and to me it feels like this is a moment we can get over that.

Speaker 2:

Well, absolutely. Instead of having good debates and a legislative framework, it is exactly the other end of the spectrum. As you said, the industry only has guidance in the form of regulation by enforcement. It's an overreach, it's chaotic, it's unpredictable and it's unclear. The crypto industry can't innovate effectively in that environment and, as a result, a lot of the crypto talent and companies have actually left the United States. The election is an opportunity to stop this trend and restore America to its place as the global heartland of the crypto innovation.

Speaker 3:

You mentioned what's at stake, and let me just briefly say, man, that would be a great name for a podcast. I wanted to ask you too, though, lauren, you know, I think to some degree, the exercise with Fairshake, but also the exercise in your ongoing engagement, is really an effort to bridge, you know what for a long time, sort of existed as this sort of parallel universe of crypto, and you bring it into the mainstream. So I would love to hear, as you've jumped into crypto, you know what is, what is a surprise, what is a kind of amusing anecdote what has shocked you or surprised you the most as you've jumped into this brave new world?

Speaker 2:

I think what's been most interesting is, when I jumped into crypto, I did a lot of due diligence on the company. I was joining Ripple. I truly believe in the vision. I think we have very, very strong, very respectable leadership.

Speaker 2:

But the industry at large has had some unsavory moments, especially with FTX, which was not crypto fraud, that was just fraud. And you walk into the room and the entire industry is still under this FTX misconception, and so it's an uphill battle indeed. But going in and making sure people understand that there are really good actors in the space, that there's really solid technology and technology that's truly going to enhance how business is done, how people are able to have financial inclusion, financial health, have access to capital. It's changing and we have to meet people where they are, and so the most amusing is you go into these meetings and you understand you're starting almost at a deficit in terms of your education and your brand building, but for me, I see that all as opportunity, and so to take that opportunity to really tell Ripple's story, to really try to express that mission and win champions that's the goal and it's exciting, it's truly exciting.

Speaker 1:

It's great to hear you say that, because I feel like this is true. With a lot of new industries that come to DC, there's sort of the crazy sugar high and one CEO or one company tends to stand out and in this case, spf was everywhere and then he was exposed for, like you said, just plain old fashioned fraud. And it creates that vacuum now of like, okay, now we've got to reset and go educate and I feel like I come every May, june and like this is the summer, we're going to see crypto legislation or something, but the education is still continuing. But I'm curious, like, how close are we getting? We talked about McHenry considering his bill. Do you think Congress is getting there? They'll be there after the election or we'll start to see some real progress on legislation?

Speaker 2:

I'm very hopeful and I'm very optimistic. The best news that I have is there has been pen to paper. There are draft bills, two bills moved out of the House Financial Services Committee last July. We're expecting some consideration on the floor for a market structure bill and we're expecting to see stable coin language very soon. Both of those things are a huge flag in the sand in terms of how our industry can be maintained and how we should be regulated. If they do not pass this Congress, there is a precedent for it to be able to be enacted next Congress, and so this all ties in from the work of the Super PAC, the work of the education we're doing with policymakers on the Hill in the administration. It all comes together for the push forward of continuing to have clear rules of the road.

Speaker 3:

We've touched, lauren, on the crypto ecosystem and some of the maybe unexpected challenges as it relates to the broader perception of the industry. But you know, when you think about Ripple and your engagement with policymakers, you know where do you see some of these big differentiators? Where you know it's so clear that you're a good actor and you know working for that. You know productive engagement.

Speaker 2:

Elliot, that's a great question and I think there's been a lot of air taken out of the room with some misconceptions about the industry at large.

Speaker 2:

You know you have senators like Elizabeth Warren, who is truly a magnificent safety hawk, but she is putting out statements about illicit finance within the cryptocurrency industry, where, when you transfer paper dollars, it's much less tracked in any way, shape or form. Ripple is synonymous with safety. We have a huge dedication to our compliance program. We are a compliance-first mindset. We think about safety in every aspect of what we do and we're a closed-circuit company, so anytime we onboard a customer, there is a huge amount of due diligence brought on in terms of ensuring that we know our customer. We make sure there's all the anti-money laundering work that has been done. We abide by the Banking Secrecy Act. We don't operate in any sanctioned country and it's something that is true to our values and true to everything we do, and I think, as you're looking toward the future of the crypto industry, that is a standard, it's a gold standard that the entire industry must abide by, and Ripple is spearheading that.

Speaker 3:

Well, and it's such a good point about cash, right, I always laugh. Like you get a dollar bill and it's got someone's graffiti from like 30 years ago right, like that dollar has lived a long life. You have no idea what it's done. And I think the promise of some of this tech is really being able to have the microscope to make sure that we are excluding bad actors and preventing that illicit activity. Right, that's what I find so ironic, I think, about the accusations, you know one way or the other about crypto and about compliance, is you really can't find a more clearly compliant technology if you're interested in really rooting out some of that activity.

Speaker 2:

Well, absolutely, and technology it enhances safety. The more technology you have, the more safeguards, the more ability to track, the more ability to understand where your money is going. And with any kind of cryptocurrency, before you could actually utilize it in the world, you have to go to a bank to be able to transact that into cash right, and you've seen terrorist organizations say they don't want to use cryptocurrency because of those safety enhancements, and so I think there's a lot of education and research that should be shown.

Speaker 1:

Anything else top of mind you want to share with us about the future. Holds any crystal ball predictions as we wrap up.

Speaker 2:

Well, absolutely, brian. I'm incredibly bullish about Ripple and the crypto industry overall and, as I mentioned, with the FTX debacle in the rearview mirror, there's a growing positive focus on crypto, both in the Beltway and nationwide, and with Ripple's but the broader industry, and I am so excited to see what is coming down the pike.

Speaker 1:

Well, you'll have to come back on and share that with us when it happens. But thank you so much for joining us this week. Always learn something, always great to have you on, so we appreciate it. Thank you so much for joining us this week. Always learn something, always great to have you on, so we appreciate it.

Speaker 2:

Thank you, it was such a pleasure to be here.

Speaker 1:

And for all our listeners. Thank you for tuning in to another episode of what's at Stake. You can follow us on Twitter or X, as well as LinkedIn, and you can get copies of the episode wherever you consume your podcast Spotify, Amazon, Apple, wherever you'd like and learn more on our website, pentagroupco. We'll see you next week.