Ripple CEO: Next Two Weeks Critical for U.S. Crypto Legislation

Ripple CEO Brad Garlinghouse warned on Tuesday that the next two weeks are pivotal for passing broader cryptocurrency legislation, stating that if the Senate Banking Committee does not hold a critical markup, the chances of a bill passing into law will drop “precipitously.” Garlinghouse made the remarks at the Consensus Miami conference hosted by CoinDesk. The warning reflects mounting pressure to pass a comprehensive crypto bill that would regulate the industry at the federal level for the first time, allocating jurisdiction between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).

Senate Legislative Timeline and Political Obstacles

Garlinghouse emphasized that timing is essential due to the November midterm elections. “Candidly, if it doesn’t happen, then I think the likelihood is going to drop precipitously because if it gets into midterms — it’s going to be too much of a loaded issue,” he said. “Then, post-elections in the fall, I think the likelihood that it gets picked up is even lower.” The House passed its version of the bill, nicknamed Clarity, last year, but progress in the Senate has been slower. A bill must pass out of both the Senate Agriculture Committee and the Senate Banking Committee. The agriculture committee has already passed its version, but the banking panel has faced significant obstacles.

Stablecoin Compromise Clears Path Forward

A major breakthrough occurred last week when Senators Angela Alsobrooks (D-Md.) and Thom Tillis (R-N.C.) reached a compromise on how to treat stablecoin rewards, potentially clearing the way for a banking committee markup this month. However, other issues remain unresolved, including concerns over crypto-related conflicts of interest tied to President Donald Trump and questions around illicit finance.

Agency Guidance as Interim Measure

In the absence of Congressional action, the SEC and CFTC have moved forward in clarifying their regulatory stances through guidance and a token taxonomy indicating that most cryptocurrencies are not securities. However, legislation provides a level of permanency that neither agency can achieve independently when a new presidential administration takes office. Regulatory approaches have shifted significantly between administrations: under the previous Biden administration, SEC Chair Gary Gensler took a starkly different approach than current SEC Chair Paul Atkins. Gensler asserted that most cryptocurrencies were securities and brought several major enforcement cases against major industry players over registration failures and fraud concerns.

Regulatory Consistency and Ripple’s SEC Case

Garlinghouse emphasized the importance of codifying crypto regulation into law to prevent regulatory reversals. “Hopefully the trend line has moved far enough that we don’t go back no matter what, but codifying it into law means you kind of can’t go back now,” he said. This concern stems partly from Ripple’s own experience: in 2020, the SEC sued Ripple and accused it of raising $1.3 billion through unregistered XRP sales. The case was brought under the first Trump administration when Jay Clayton led the SEC but continued during Gensler’s tenure. A New York judge later ruled that some of Ripple’s programmatic sales—conducted through a blind bid process—did not violate securities laws. However, the judge ruled that direct sales to institutional investors were securities. Ultimately, the judge determined that XRP itself is not a security, depending on how it is sold. Garlinghouse stated: “That’s clarity for XRP, but I think for the industry to really move forward in the United States, you need something like the Clarity Act to make it clear about other digital assets as not being securities.”