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Ripple CEO Brad Garlinghouse has said that even though his fintech company has been at loggerheads with regulators for years, the U.S. Securities and Exchange Commission (SEC) won’t let the company’s founders help build the virtual We are confident that we will approve exchange-traded funds (ETFs) for the currency.
Fund manager Bitwise filed for an XRP ETF at the beginning of the month. If the fund is approved, it will be traded on stock exchanges and investors will be able to access XRP without actually owning the cryptocurrency.
The filing came as a surprise because Ripple, whose founders developed XRP, has been embroiled in a legal battle with the SEC since 2020. Still, Garlinghouse doesn’t seem concerned.
“For me, it’s inevitable that[the”Thereisdemandfrom”headded
Another asset management firm, Canary Capital, also filed to launch an XRP-based ETF this month.
Garlinghouse said the SEC ultimately approved the Bitcoin and Ethereum ETF, a product launched by top Wall Street firms, even though it clearly didn’t want to.
However, given the ongoing dispute with Ripple, the XRP ETF may not be approved any time soon. Back in 2020, SEC regulators filed a $1.3 billion lawsuit against the company for selling unregistered securities in the form of XRP.
Last year, Ripple won a partial victory against regulators when a judge ruled that programmatic sales of XRP to retail investors did not qualify as securities.
Although the judge ruled that the $728 million worth of institutional sales agreements did constitute unregistered securities sales, the news still shocked the industry and was widely interpreted as a victory.
In response to this ruling, the SEC sought a hefty fine of $2 billion against Ripple. A New York court subsequently ordered the company to pay a penalty of just $125 million, but this was also widely interpreted as a major victory for Ripple and the crypto industry.
The SEC asked for $2 billion, but the court found they had overreached and reduced the request by up to 94%. We have made it clear that we respect the court’s decision and will continue to grow our company.
This is a victory for Ripple, the industry, and the rule of law. SEC…
— Brad Garlinghouse (@bgarlinghouse) August 7, 2024
The SEC is currently appealing the judge’s decision. Ripple’s chief legal officer Stuart Alderroti told Decrypt in an interview last week that he doesn’t think the appeal will be successful and believes the move will “backfire” on Ripple.
XRP is the 7th largest cryptocurrency by market capitalization. Although it is not controlled by Ripple, Ripple’s founders created XRP and their company still uses the asset for money transfer solutions.
According to CoinGecko, XRP remains well below its 2018 all-time high of $3.40. The current price is $0.51, down about 11% in the last month.
Edited by Andrew Hayward
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