Ripple is a blockchain-based digital payment company that has created a network and protocol that uses the cryptocurrency XRP and the XRP Ledger. Ripple’s main focus is as a payment settlement asset exchange and remittance system, similar to the SWIFT system for international money and security transfers used by banks and financial intermediaries dealing across currencies.
Ripple’s products serve as a sort of temporary global settlement layer for businesses and individuals.
Key Takeaways
- Ripple is a blockchain-based digital payment network and protocol that uses the XRP Ledger blockchain and XRP.
- XRP makes money by providing cross-border payment and crypto liquidity services to businesses.
- One of the first of its kind, Ripple operates in the blockchain and cryptocurrency financial services industry.
- In 2024, Ripple announced its new institutional decentralized finance solutions designed to help centralized financial institutions access decentralized finance platforms and achieve regulatory compliance. It also plans to release a stablecoin backed by U.S. dollars.
Ripple’s Industry
Ripple operates in the financial technology industry, providing blockchain and cryptocurrency cross-border payment, crypto liquidity, and central bank digital currency services. Its platforms use the XRP Ledger and its native token, XRP, in its services.
Ripple is unique in this industry as it created the first financial services platform and network that accesses and uses blockchain and cryptocurrency for enterprises. It has developed products that provide liquidity and uses cryptocurrency and a bridge currency to speed up international transactions and reduce costs.
Additionally, Ripple has helped countries create their own central bank digital currencies (CBDCs) through its Ripple CBDC platform.
Ripple’s Fundraising and Financials
Since 2012, Ripple has had 14 fund-raising rounds, raising a total of $293.8 million. The most recent backers include Uday Kumar Bangalore Shivaraman, The K Fund, and Azure Ventures Group.
The company’s most recent valuation was over $11 billion, which includes a rumored $285 million stock repurchase in 2024.
History and Leadership
Ripple was founded in 2012 by Chris Larsen, David Schwartz, Author Britto, and Jed McCaleb after work began on the XRP Ledger. Its original name was OpenCoin, but it quickly went through a series of name changes until finally becoming Ripple.
Founders:
- Chris Larsen: Has a long history of success in financial technology endeavors.
- David Schwartz: A multi-discipline engineer with a long track record in developing software solutions.
- Jed McCaleb: Has been involved in software development and cryptocurrency since the early 2000s.
- Author Britto: A software engineer with a long history of programming.
Ripple’s current leadership is:
- Chief Executive Officer: Brad Garlinghouse
- Chief Technical Officer: David Schwartz
- President: Monica Long
- Chief Financial Officer: Jon Bilich
Recent Developments
Ripple has been expanding its capabilities by acquiring companies involved in cryptocurrency and technology that complements it. In 2024 and 2023, it acquired Standard Custody & Trust, Metaco, crypto custody services providers. These acquisitions will likely help Ripple with its plans to offer crypto liquidity services to institutions in addition to institutional decentralized finance solutions.
In 2020, Ripple was sued by the Securities and Exchange Commission. The Commission alleged the business had sold unregistered securities in its fundraising activities.
In 2023, Judge Analisa Torres decided that XRP was not a security when sold on exchanges but was a security when sold to institutional investors. The SEC dropped all charges against Chris Larsen and Brad Garlinghouse but continued to insist on fining Ripple nearly $2 billion, which Ripple contested.
Did Ripple Win the Lawsuit?
Ripple scored some victories in its defense against the Securities and Exchange Commission but lost regarding the treatment sales of XRP to institutional customers.
Why Is Ripple Banned in the US?
Ripple is not banned in the U.S. It is a company that provides blockchain and cryptocurrency services to institutional customers. To avoid selling XRP to institutional customers, Ripple uses XRP in its services outside of the U.S. but not within it.
What Happens to My XRP if Ripple Loses the Lawsuit?
Ripple did not lose the lawsuit against the SEC, but it may face fines. Because your XRP is not owned or controlled by Ripple, it will still exist, but its market value could fluctuate with the decision about fines.
The Bottom Line
Ripple is a blockchain services and tech company that provides financial services for companies around the world. It was started by the same developers who created XRP and the XRP Ledger, but it does not own the blockchain or develop it.
Ripple is the first business to incorporate blockchain and cryptocurrency into a global enterprise financial network. It operates in a new industry, so there have been many speed bumps, such as regulatory concerns and lawsuits.
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