Ripple almost disappeared: CEO told how the company almost gave up before the SEC

Ripple CEO Brad Garlinghouse first publicly revealed how close the company came to shutting down after the US Securities and Exchange Commission's lawsuit in 2020. Speaking at the University of Kansas School of Business, he admitted: he and co-founder Chris Larsen seriously considered winding down the business and distributing XRP reserves among shareholders proportionally to their shares.

According to Garlinghouse, this would have been the easiest way out - opposing a government regulator with «infinite resources» seemed like an almost impossible task. The SEC accused Ripple of selling XRP as an unregistered security and named Garlinghouse and Larsen as personal defendants in the case.

The decision to fight was not easy. The main argument was people: closure would mean laying off hundreds of employees. The lawsuit lasted four years and cost the company approximately $150 million in legal expenses.

The bet turned out to be correct. Judge Analisa Torres ruled that XRP in itself is not a security. The case was finally settled in May of last year - already under the new leadership of the SEC, which has taken a more constructive approach to dialogue with the crypto industry. Interestingly, Garlinghouse met with representatives of the regulator four times between 2017 and 2019 - and never received a signal that XRP could be classified as a security.

The Ripple story has become one of the key precedents showing: regulatory uncertainty is not an abstract risk, but a real threat to business. And at the same time - an example of how readiness to defend your position in court can change the rules of the game for the entire industry.

#Ripple
#XRP
#SEC
#Garlinghouse
#regulation
#cryptocurrency
#court
#Brick