Bitcoin Could Meet a Similar Fate to Napster, Says Ripple CEO

Brad Garlinghouse, CEO of cross-border payment startup Ripple, recently compared Bitcoin to Napster. He shared this opinion during a conference held this week, according to Cointelegraph.

Garlinghouse said that even though Napster started peer-to-peer file sharing, it couldn’t live up to the potential it possessed. As Napster spiraled down to irrelevance, others like Spotify, iTunes and Pandora rose up to take its place as these companies cooperated with regulators.

Ripple’s CEO said that Bitcoin will meet a similar fate. "There's going to be a bit of a correction along the way here where a lot of the players in the space that don't actually solve a real problem are going to get washed out.”

Despite Bitcoin’s explosive popularity in its nearly 10 years of reign, Garlinghouse’s sentiment does hold a lot of truth. It can be recalled that the cryptocurrency was ranked 13th on China's recent comprehensive list of top cryptocurrencies.

The reason why it didn’t even get into the top 10 was that it scored low in two of the three criteria used to distinguish which digital currency is leading the crypto market. These criteria were technology, innovation, and application.

While Bitcoin scored the highest in the innovation category, it did poorly in the technology criteria and only got an average review in application. This is because Bitcoin’s utility is limited to its capacity as a means of payment. Outside of that, the cryptocurrency doesn’t really do much else. This fits perfectly well with the earlier quote of Garlinghouse about cryptocurrencies that aren’t designed to solve problems.

Ripple’s CEO also had a dialogue with CNBC regarding crypto and the legal framework taking shape in the United States. During the exchange, Garlinghouse responded to a statement made by a former U.S. government regulator that Ripple (XRP) and Ethereum (ETH) could possibly be deemed “unregistered securities.”

He said that owning XRP isn’t equal to owning a stock in the company. “If you own XRP, you don't own rights to the profits or any dividends to the company. XRP has real utility,” Garlinghouse countered.

Despite the statement, the CEO stands firm that the government should definitely be involved in the growth of the crypto market as illicit activities run abound in the industry. Indeed, the SEC recently secured a court order against a company which sold overvalued initial coin offerings (ICO) to domestic and foreign investors, accumulating a $21 million investment fund.