Top blockchain firm Ripple Labs has been working to navigate through 2020 that hasn’t quite turned out how it expected. Amid new concerns over whether it would like to stay in the United States. The firm has made another expansionary move as it opens an office in Dubai.
Taking Advantage of Innovative Regulations
According to an announcement over the weekend, Ripple has set up an office at the Dubai International Finance Center (DIFC). The statement explained that Ripple had chosen the location for its friendly, innovative regulations, with the economic zone serving thousands of companies from across the world.
Navin Gupta, a managing director at the firm, explained that the decision also came from the company’s desire to stay closer to its customers in the Middle East and North Africa region, where it is establishing a more prominent presence.
“Our regional office will serve as a springboard to introduce our blockchain-based solutions and deepen our ties with even more financial institutions in the region,” Gupta added.
The DIFC is an interesting place to situate a company location. Based in the United Arab Emirates (UAE), the economic zone offers zero taxes on corporate income and profits for at least 50 years – a benefit that Ripple will now enjoy. The move is in line with increased efforts from the UAE to adopt blockchain and become a leading FinTech hub in the years to come.
While the taxes are undoubtedly an incentive, it also appears that Ripple made the move due to the Dubai regulatory scheme, which it noted to be innovative. The blockchain company has been looking at the possibility of moving its headquarters for a while now. So far, friendly regulations have been top on their priority list.
Who Gets Ripple’s Business?
Last month, Ripple Labs CEO Brad Garinghouse told CNBC that the company had noted an inadequate regulatory structure in the United States and could be looking at moving entirely. As Garlinghouse explained, the Securities and Exchange Commission (SEC) had failed to move quickly when it comes to crypto regulation, despite years of lobbying and appeals from top industry players.
Chris Larsen, one of the company’s co-founders, also sang a similar tune. Speaking with Fortune Magazine, Larsen decried the United States’ lagging in crypto innovation. He also criticized financial regulators for what he believed was a “regulation through enforcement” strategy that hurt crypto development.
Both company executives touted different countries when pressed about the possibility of finding a new headquarters. While Garlinghouse seemed to have his heart set on the United Kingdom, Larsen also considered countries like Switzerland.
Then, last week, Yoshitaka Kitao, the head of Japanese financial services giant SBI Holdings, said at a press briefing that Ripple should consider setting up shop in Japan. SBI Holdings is an investor in Ripple, and Kitao has a seat on the blockchain company’s board. He seemed to be confident about the company’s prospects of moving to the East, with Bloomberg also noting that Garlinghouse had begun making inquiries about the feasibility of such a move.
For now, it’s unclear whether Ripple would even move. However, if it decides on such an action, the options are endless.