He also discussed potential applications for digital assets in machine-to-machine and small-value payments. According to Garlinghouse, such use cases could require payment systems capable of processing transactions worth fractions of a cent.
At the same time, he said $XRP is not suitable for every use case and that different digital assets can serve different purposes.
Ripple Sees Regulatory Clarity as Important
Garlinghouse also discussed the impact of regulation on cryptocurrency adoption.
He said financial institutions are cautious about adopting digital assets when regulatory requirements are unclear. He pointed to the GENIUS Act as an example of legislation that provided greater clarity for stablecoins, particularly around disclosures and reserves.
According to Garlinghouse, stablecoin payment activity increased following the introduction of clearer rules.
He also referred to Ripple’s legal case involving the U.S. Securities and Exchange Commission, saying the company spent four years and about $150 million defending the case.
Garlinghouse pointed to the court’s finding that $XRP itself is not a security as providing greater clarity for Ripple. He added that the wider cryptocurrency industry still faces regulatory uncertainty around how different digital assets should be classified.
Ripple Expands Its Payments Business
Garlinghouse said Ripple initially focused on banks and payment providers but is now expanding its reach through acquisitions.
He highlighted Ripple’s acquisition of GTreasury, a treasury management company that serves large businesses. According to Garlinghouse, companies using GTreasury collectively handled about $13 trillion in payments during the previous year.
Ripple sees the network of corporate finance teams and treasurers using the platform as a potential distribution channel for its payment technologies.
Garlinghouse said Ripple could introduce stablecoin or $XRP-based payment options to companies looking for alternatives for international transactions.
Garlinghouse Separates Ripple From $XRP
The Ripple CEO also addressed the relationship between the company and $XRP.
He said the $XRP Ledger is open-source and decentralized, while Ripple controls about 2% of its validators. According to Garlinghouse, ownership of $XRP does not provide control over the network’s governance because the ledger does not use a proof-of-stake system.
He argued that Ripple’s ownership of $XRP should therefore not be interpreted as control over the $XRP Ledger.
Garlinghouse Says Crypto Could Serve Different Roles
Garlinghouse also discussed the potential role of cryptocurrencies as long-term financial assets.
He described Bitcoin as a store of value and said other digital assets could develop around different use cases. He specifically identified payments as an area where $XRP is focused.
Garlinghouse said he expects financial institutions to continue exploring digital assets as the cryptocurrency industry develops.
For $XRP, the focus remains on payments, financial institutions and the use of blockchain technology for moving value across borders.
