Q&A: Ripple GC on Cryptocurrency, the Law and Blockchain Hype
"Just because you have a new technology doesn't mean that no laws apply to it," says Ripple general counsel Brynly Llyr.
November 01, 2017 at 07:22 PM
4 minute read
SAN FRANCISCO — The world of cryptocurrencies may seem like a lawless, financial Wild West. But for the general counsel of a blockchain company focused on moving money internationally, it's anything but.
In this excerpt from an interview on Law.com's ”Unprecedented” podcast, Ripple Labs GC Brynly Llyr talks about navigating the complex regulatory environment facing cryptocurrencies like XRP—and how a lot of her time is focused on relatively straightforward issues like intellectual property and contracts. Llyr also gives her views on the hype around blockchain in the legal profession.
Listen to the full interview here, or subscribe on your iOS or Android device. The transcript has been edited for length and clarity.
Ben Hancock: There's been a lot of controversy over cryptocurrencies. The U.S. Securities and Exchange Commission and the government of China have taken steps to either curb trading in cryptocurrencies or initial coin offerings. But I want to move a little past that and ask about the biggest legal issues you face day-to-day in this space.
Brynly Llyr: I don't know if we can just step over ICOs and some of those other issues. It's not day-to-day, but those are definitely big legal issues in this space. In my mind, it comes down to something that is kind of a simple concept. And that is: Just because you have a new technology doesn't mean that no laws apply to it.
It is a new way of doing things, absolutely. But going back to that example of using our technology to help banks move funds cross-border. Well, it's a new technology, but it doesn't mean that all of those things that we care about related to moving money around—like anti-money laundering and terrorist financing—those considerations don't go away just because we have a new technology. And to think that they do is pretty simplistic.
My understanding is that the banking sector is a lot like the legal sector, in that it's not super prone to racing ahead and jumping on the bandwagon with new technologies. Is that what you're finding?
Banks are by nature, I think, more conservative institutions.
And that is not a bad thing, absolutely not a bad thing. And correspondent banking has been around a long time. But that said, if you've had an experience with the banking system—two days, four days, this batching system and how we go about moving about moving payments— we can improve that, and I think even banks are seeing this can be improved. Not just because of efficiency, but just to bring down the error rate. They need to stay competitive as well.
I've asked you about some of the things you do day-to-day. If there are one or two big legal issues that you're looking at right now, what are they?
Well, we're a technology company, so IP and IP protection is a big deal for us, of course. Our trademarks around the world, our patent, our patent portfolio. That becomes very important.
How we are rolling out new products, and that we have really thoughtful product counseling along the way—that we're thinking about how that product will sit in the different regulatory regimes. That takes up a lot of our time. Our commercial deals, we have a number of new customers all the time, and so there's a lot of commercial work that comes with that.
There's been a lot of, I guess “hype” is the right word in the legal community about how you can take blockchain out of the cryptocurrency context and into other contexts, whether its contracts or other legal applications. What are your thoughts about that?
There is a lot of hype right now, I would say, in blockchain—this idea that we can apply it to everything and it's going to make everything better. Well, no. I mean, let's just roll it back to these core concepts: we have a shared ledger, there's transparency, there's certainty.
OK, if these are the core concepts that make up blockchain, what systems would benefit from that kind of technology? I think about selling your house, and chain of title for a property. Yeah, that's a good use for a blockchain. Identity? That could be a great technology for identity and tracking identity. And some other things. But it's not going to work for everything.
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