Gifford is no stranger to traditional banking, and Ripple famously hired her for her impressive resume which includes eight years as an active member of the litigation and enforcement group for the Federal Reserve Bank of New York. Her role as compliance officer should come as no surprise, but as you’ll find in the comments quoted below (and playable in the embedded video), she all but touts Ripple’s privacy invasion techniques as a new era in banking.
Following Ripple co-founder Chris Larson’s now-infamous commentary that the “world doesn’t need a currency,” (at about 5:00) Gifford says:
One thing that I should just clarify technically […] one of the differences between the Ripple technology and, like the Bitcoin technology in terms of transparency just happens to be that the way that the Ripple technology tracks information is by account. […] And an account is connected with an account holder, an individual or an entity that’s holding that account. So, using this technology we’re able to see financial activity by account holder.
The underlying point of the Ripple presentation to the California assembly was, in essence, that Ripple is a way for banks and large institutions to move value faster and with more efficiency. Nevermind that it was based on ideas by people who very specifically were opposed to traditional banking, ideas released in the wake of the global financial crisis brought on by said traditional banks at the end of the last decade. Nevermind that, they say: Ripple is here to deliver banking 2.0.
Despite the many regulatory concerns that governments have about Bitcoin, the very purpose of it is to eliminate centralized banking as a necessary entity. While it is widely used as a speculative tool and occasionally used to hide money from tax auditors, the stated intent of Bitcoin is to eliminate financial institutions from the equation, in much the same way that going to buy a car with a pocketful of cash eliminates them from it. It bears reminding, in times like these, that the very first line of the Satoshi Nakamoto’s white paper reads:
A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.
At that point in history, financial institutions had proven themselves unworthy of having any part of such transactions. They had wrecked multiple segments of the economy, created unsustainable interest rates, and bankrupted millions of earnest workers while putting millions of others on the street. Interest in an alternative way of doing finance was at an all-time high, and so was born Bitcoin.
Whether Bitcoin will always be the most important cryptocurrency, that is a question to be answered by time alone. Whether something like Ripple, which seeks to further centralize (and therefore create a wider failure point for) transactions of value is accepted by more regulators is irrelevant.
Another thing that bears stating when this kind of image is being presented to the hands that hold the gavels is that Ripple has had problems Bitcoin couldn’t dream of having. The network was proven to be ridiculously insecure just last October, and here they are in March, representing 50% of the cryptocurrency participants in a hearing that Satoshi wouldn’t have dreamed of ever happening.
One would think that the Bitcoin Foundation, not a representative of private company Coinbase, would have been there to speak on the currency’s behalf. But, as you know, they’re having some … issues these days.
Original audio sourced from here. The author thanks Karen Gifford for giving him such a monumentally hyperbolic bunch of statements to ponder in preparation of this article.
Image from Shutterstock.
Last modified: June 13, 2020 9:42 PM UTC