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Ripple Labs: Plans to repurchase $285 million worth of shares, still not considering going public in the United States

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Ripple Labs: Plans to repurchase $285 million worth of shares, still not considering going public in the United States

According to a Reuters report, the cryptocurrency payment company Ripple Labs plans to buy back $285 million worth of shares from early investors, valuing the company at $11 billion. The company also disclosed that it holds over $1 billion in cash and over $25 billion in digital assets on its balance sheet.

Ripple Company Valuation Soars to $11.3 Billion

Reuters reported, citing anonymous sources, that Ripple Labs is planning to buy back $285 million worth of company shares from early investors and internal employees, which would bring the company's valuation to $11.3 billion.

The sources also added that early investors can sell up to a maximum of 6% of their holdings.

Ripple CEO Brad Garlinghouse confirmed and responded to this:

Ripple expects to conduct more stock buyback programs regularly to provide liquidity and flexibility for investors.

Garlinghouse also mentioned that the company holds around $1 billion in cash and $25 billion in cryptocurrencies on its balance sheet, with the majority being XRP that they issued themselves:

Ripple plans to use $500 million to purchase up to $285 million in equity and the remaining over $200 million to cover the cost and taxes of converting restricted stock units (RSUs) to shares.

He also noted, "Due to regulatory uncertainty, Ripple is not considering going public in the United States at this time."

Ripple Case Still Unresolved

In December 2020, the U.S. Securities and Exchange Commission (SEC) formally charged Ripple and its executives with selling unregistered securities and manipulating coin prices, drawing attention from the community.

Quick analysis of the Ripple lawsuit, unlike EOS, individual charges are also unprecedented in the cryptocurrency industry

As the lengthy legal process continues, after two and a half years of litigation, the Ripple case finally saw an initial victory, ruling that Ripple's XRP token itself is not a security.

However, the judge still believes that the company's institutional sales involve investment contracts, illegally offering and selling unregistered securities, which is not much different from most cryptocurrency issuers.

After reading the XRP court documents, a detailed explanation of why XRP and the cryptocurrency industry have not escaped securities risks

The SEC subsequently sought an interlocutory appeal in October last year, but it was rejected by the judge in the case, stating that they failed to provide substantial reasons for questioning the previous judgment.

Furthermore, the litigation between the SEC and Ripple is not yet fully concluded, with summaries of the SEC's remedial measures and both parties' responses to those measures set to take place from February to April.

Ripple Actively Expanding Overseas

On the other hand, following the preliminary victory in the lawsuit, Ripple has begun actively engaging with various parties to expand its business footprint.

This includes participating in Mastercard's CBDC partnership program, acquiring U.S. trust company Fortress Trust to add more currency transfer licenses, and jointly establishing a cross-border payment company, SBI Ripple Asia, with Japanese financial giant SBI to introduce their remittance solution to the Southeast Asian region.