Governments around the world are right to step up regulatory pressure on initial coin offerings (ICOs), the CEO of blockchain firm Ripple has told CNBC.
Brad Garlinghouse, whose company is the owner of the third-largest cryptocurrency by market capitalization, XRP, questioned whether new digital currencies were “solving real problems.”
“There’s plenty examples of these recent ICOs that I don’t think are good for the industry because they are not demonstrating or solving a real problem and you are seeing examples of fraud,” he told CNBC in an interview Monday.
“And so I think it’s good that you have regulators intervening and stepping in, in countries around the world.”
ICOs are a means for start-ups to raise funds selling new virtual currencies in exchange for bitcoin or ethereum. But they have caused a stir internationally in recent weeks, with a number of regulators either clamping down or banning them outright.
Garlinghouse said Ripple, by contrast, is focused on solving a “trillion dollar problem” with its distributed ledger platform, which connects banks with payment providers and cryptocurrency exchanges.