Ripple CEO Talks IPO Plans And Competition Strategy Against SWIFT

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As a long-term crypto investor with a keen interest in the latest developments within the industry, I find Ripple’s strategic decisions and competitive edge over traditional systems like SWIFT intriguing. Brad Garlinghouse’s recent interview with Fortune provided valuable insights into Ripple’s plans, regulatory challenges, and their stance against SWIFT.

In a conversation with Fortune’s Andrew Nusca, Brad Garlinghouse, the CEO of Ripple, shared insights about the company’s business strategy, their careful consideration of going public through an Initial Public Offering (IPO), and how Ripple distinguishes itself from the established SWIFT network.

A Ripple IPO Currently Not On The Table

Garlinghouse openly discussed Ripple’s choice to postpone an IPO due to regulatory difficulties. He explained, “We’ve made it clear that we currently have no plans to pursue going public. Why would we do so in the current SEC climate? I’m not exactly welcomed there.”

The court decision from last July, which labeled XRP as non-security, has created tension between Ripple and regulatory bodies. In response to this, instead of moving forward with an Initial Public Offering (IPO), Ripple’s CEO, Garlinghouse, revealed during an interview their alternative strategy.

The Ripple CEO shared an alternative perspective on IPOs, viewing it as a milestone rather than the final destination. Instead of going public through an IPO, they’ve opted for a series of tender offers to buy back shares from investors and employees. Currently, they are in the process of another such offer, and upon completion, they will have repurchased approximately $4 billion worth of stock from their shareholders.

Ripple Vs. SWIFT

Garlinghouse also spoke about Ripple’s competitive edge against SWIFT, the widely-used standard for financial messaging and cross-border payments. He pointed out the antiquated nature of existing wire transfer systems, stating, “Most of us have used a SWIFT Transfer at some point in our lives, which is essentially an old-fashioned wire transfer.” He emphasized the historical background, explaining that the term “wire transfer” originates from telegram wires, and it’s not a technology that has kept pace with the internet.

Brad Garlinghouse advocated for Ripple’s revolutionary method in global money transfers, capable of significantly diminishing the obstacles encountered. This is reminiscent of advancements experienced in digital communication. “Do we rival SWIFT? Yes, there are numerous payment networks available, and when I consider the fundamental objective of Ripple, we aim to enable value transfer as seamless as information exchange today,” he stated. By invoking the analogy of email protocols that interconnected disparate systems, Garlinghouse emphasized Ripple’s mission to foster similar compatibility between varied payment networks.

When Will The XRP Lawsuit End?

I, Garlinghouse, discussed the lengthy court battle between Ripple and the SEC concerning XRP‘s classification. This protracted legal dispute incurred significant expenses but ultimately led to a favorable decision last summer. I explained, “I viewed XRP as a currency, and we waged a three-and-a-half-year legal fight. We emerged victorious on the essential point: XRP isn’t a security in itself.” However, the financial toll was steep, amounting to approximately $150 million in legal fees.

Regarding the remaining issues and penalty decision in the ongoing lawsuit, Garlinghouse expressed confidence that a resolution would be reached soon. He mentioned there are a few key points the judge needs to rule on, possibly within a month or even less, although he couldn’t be certain of the exact timeline. He is eagerly anticipating a complete resolution.

At press time, XRP traded at $0.58336.

Ripple CEO Talks IPO Plans And Competition Strategy Against SWIFT

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2024-07-19 03:42