Benjamin Lawsky, the former superintendent of financial services for New York State, is joining Ripple’s board of directors. The company also appointed investment banker and TubeMogul CFO Ron Will as its own new CFO.
Lawsky is best known in Bitcoin and cryptocurrency circles as the creator of New York’s “BitLicense” regulations in 2014-15. The BitLicense, which was the first U.S. law specifically designed to regulate the digital asset industry, has been both praised and maligned by its stakeholders.
BitLicense and Lawsky Have Mixed Reputation in Blockchain Industry
The law was initially welcomed as an attempt to legitimize Bitcoin and blockchain companies, with a view to attracting New York’s large-scale investors. It also made a distinction between companies actually holding digital assets for themselves or clients, and those simply developing software (the latter of which do not require licenses).
Lawsky also famously participated in multiple Reddit “AMA” sessions in 2014, where he faced Bitcoiners’ questions and accusations about his proposed laws.
However several companies have complained New York set the bar of entry too high, discouraging smaller startups that lacked the legal and financial resources to comply with the requirements. Only a handful of BitLicenses have actually been granted, while some startups have left New York State or blocked customers from there.
Shortly after creating the new laws, Lawsky quit his superindendent position and started a private consultancy called The Lawsky Group — which specialized in advising clients on how to navigate the blockchain/cryptocurrency legal landscape.
Ripple announced Lawsky and Will’s appointments on its website and via social media on 21st November:
Ripple is growing and with the appointment of @benlawsky as a new board member and @ronxwill as our new CFO, we’re on a path to accelerate adoption of blockchain and digital assets in the years ahead.
— Ripple (@Ripple) November 21, 2017
Twitter responses to the announcement reflected the various attitudes towards BitLicense, Ripple, and regulators in general.
Wait…the Ben Lawsky that made it tougher for crypto companies to operate in New York and then made his own firm to help companies get approval from his own regulations? Can someone explain how he can help move Ripple forward? Honest question.
— Lysus_Gaming (@Lysus_Gaming) November 21, 2017
And who better than to hire the man who created the regulations? This is actually a huge step forward for current banking and Blockchain technology…
— Lee Tomasetti (@LeeTomasetti) November 21, 2017
Lawsky Was Also Tough on Wall Street
Despite critics’ allegations that Lawsky created BitLicenses to serve Wall Street, the lawyer and 20-year public servant also had a reputation for being tough on his state’s big banks.
In his four-year career at NYDFS, he frequently pursued large banks for money laundering and rigging benchmark rates, increasing penalties for both violations.
Per Ripple’s press release, Lawsky also served as co-chair of New York Governor Andrew Cuomo’s Cyber Security Advisory Board and also as the Governor’s chief of staff. He began his legal career as an assistant United States attorney in the Southern District of New York, and worked as chief counsel to U.S. Senator Charles Schumer. He was also a visiting scholar at Stanford University’s Cyber Initiative.
Pleased to Join Ripple Board
Lawsky (unsurprisingly) praised Ripple, which counts the world’s mainstream financial institutions as customers and potential users of its blockchain-like consensus network.
“Ripple is the leading enterprise blockchain company in the world today and is one that truly understands the importance of regulation-enabled innovation.”
“The company and its leadership are passionate about making our global financial system more efficient, more secure and more fair. I share those same goals and am thrilled and humbled to work side by side with their incredible team as they continue to pave the way for the growth and accelerating adoption of blockchain and digital assets in the years ahead.”
Last week, Ripple also added American Express’ FX International Payments division to its RippleNet network.
Is Lawsky’s board appointment good news for Ripple? Let’s hear your thoughts.
Images via Ripple, YouTube