Regulatory Progress and Conflicts: Ripple Receives UK Approval While DeFi Debate Escalates in the US

Ripple Secures Regulatory Recognition in the United Kingdom

Blockchain payments company Ripple has officially received registration with the UK's Financial Conduct Authority (FCA) through its local subsidiary Ripple UK Ltd. ^[1]. The approval confirms that the company meets British regulations for crypto operations, including anti-money laundering requirements ^[1].

The license allows Ripple to conduct restricted crypto operations such as exchange and payment services under FCA supervision, though the full provision of financial services in the United Kingdom remains prohibited ^[1]. Nevertheless, the approval represents a significant step for Ripple's presence in Europe and underscores the company's commitment to compliance standards ^[1].

Promoting XRP Adoption Through Regulatory Clarity

The regulatory approval could further strengthen the use of XRP, Ripple's cryptocurrency, which is widely used for cross-border payments ^[1]. Current projects, including the Ripple-backed Evernorth initiative, aim to increase liquidity on the XRP Ledger and make XRP more useful for international payments ^[1].

Clear regulatory approval gives institutions greater confidence in working with Ripple ^[1]. This confidence has already led to capital inflows, including $300 million from investors such as Korean asset manager Lean Ventures and VivoPower ^[1]. Ripple also holds licenses in other countries, including Singapore, and the UK approval complements the company's global strategy ^[1].

Anti-DeFi Campaign in the US Targets Legislation

While regulatory progress is being made in the UK, the debate over the regulation of decentralized finance is escalating in the United States. An organization called "Investors For Transparency" has launched an advertising campaign specifically targeting DeFi provisions within the proposed crypto market regulation ^[2].

Screenshots published on January 9 show that the group placed multiple ads on Fox News ^[2]. Viewers are urged to call their senators and advocate for passage of the CLARITY Act without certain DeFi provisions ^[2]. The ads include calls such as "Tell Your Senator: Pass Crypto Legislation Without DeFi Provisions" and the slogan "Don't Let DeFi Stall Innovation," along with a hotline number for direct contact with representatives ^[2].

Banking Industry Fears Deposit Losses

At the center of the criticism are provisions that would allow stablecoin issuers to offer interest-bearing products ^[2]. Banking representatives warn that such offerings could be equivalent to bank-like deposits ^[2]. The US Treasury estimated in April that with widespread use of stablecoins, up to $6.6 trillion in deposits could flow out of the traditional banking system ^[2].

The advertising offensive coincides with the Senate Banking Committee's announcement that it has scheduled an official hearing on the CLARITY Act ^[2]. Within the crypto industry, the campaign has met with sharp criticism. Uniswap Labs CEO Hayden Adams called the campaign "ironic and unsurprising," noting that the organization does not disclose its funding sources ^[2].

The CLARITY Act, a bill on digital asset market structure, is up for a vote in Congress, with passage expected as early as January ^[2]. The divergent regulatory developments in the UK and US demonstrate the global fragmentation in approaches to crypto regulation.