Ripple's close connections to XRP have long been a polarizing topic within the crypto industry, with the token's detractors claiming that the company's monetization of it via their quarterly sales has come at the expense of investors, while others claim that the token is an unregistered securities product.
Now, Ripple CEO Brad Garlinghouse has been quoted saying that XRP is the key to his company's profitability and that without their quarterly token sales they would not be cash flow positive.
This statement has generated some buzz amongst popular industry commentators, but it also comes as prominent attorneys within the blockchain space begin concluding that XRP is likely to be deemed a security at some point in the future.
Garlinghouse: Without selling tokens, Ripple would not be profitable.
As recently quoted within a Financial Times report, Ripple's CEO explained that without his company's quarterly token sales, they would not be profitable or cash flow positive, signaling that these controversial sales are the main source of revenue.
The notable use cases of XRP remain far and few between, and although it has been able to find some utility, many investors are still anxiously awaiting Ripple to announce new partnerships that usher in significant transactional volume for the cryptocurrency.
Prominent attorney claims that he believes XRP will ultimately be deemed a security.
It's crystal clear that Ripple and XRP are inextricably intertwined, with Ripple being unable to be cash flow positive without selling the token, and XRP not having any real utility without the partnerships forged by Ripple.
"My takeaway: if I am a betting man, this Court is eventually - someday, and I don't know when - going to conclude that XRP is a security and there isn't a thing that the best lawyers in the world can do to change this fundamental truth."
This comment comes in reference to a lawsuit that Ripple is currently engaged in within a California federal court regarding the token's status as a security.
XRP is the key to Ripple's profitability; here's why that could be a big issue
Published on Mar 2, 2020
by Cryptoslate | Published on Coinage
Mentioned in this article
Morpher Labs attempts to crack knotty prediction market problems
On August 31, 2020, Morpher Labs announced the launch of its flagship Ethereum-based contract trading and prediction market platform, Morpher, with the stated goal of providing users unlimited access to long-and-short trades of real-world stocks, commodities, and FOREX markets.
How to build a crypto mining rig in 2020 to earn Bitcoin and Ether
A cryptocurrency mining rig consists of a computer that has many graphics cards but no monitor.
Corporate disclosure is the only way to get crypto institutionalized
Because of this, crypto assets are becoming a fully institutionalized asset class, which can only be a good thing.
Bitcoin breaking through $12K is huge but don't expect higher prices before 2021
The previous week has been tremendous for Bitcoin investors as price broke the crucial barrier of $12,000, culminating in a surge from $11,300 to $13,300, a rally of $2,000 within a week.