Ripple Drops Acquisition of Fortress Trust, but Remains Committed to Partnership
Ripple CEO Brad Garlinghouse recently announced that Ripple will no longer proceed with the acquisition of Fortress Trust. While Garlinghouse did not provide specific reasons for discontinuing the deal, he stated that Ripple will continue to be involved with Fortress Trust in some capacity as an investor.
Background on the Decision
On September 29, Garlinghouse shared the news on X (formerly Twitter) that Ripple had decided not to acquire Fortress Trust. This decision came despite signing a letter of intent for the acquisition just three weeks earlier on September 8. However, Garlinghouse praised the talented team at Fortress and expressed potential for future collaboration between the two companies.
Ripple’s Interest in Fortress Trust
Ripple previously highlighted the valuable role that Fortress Trust could play in complementing its ongoing advancements. The technology and licensing of Fortress Trust were seen as vital in supporting the expanding enterprise crypto market. Ripple believed that Fortress Trust aligned well with its business and product plans and acquiring it would expand Ripple’s portfolio of regulatory licenses.
Regulatory Scrutiny and XRP Price
Ripple is currently under regulatory scrutiny from the U.S. SEC. Despite a court ruling stating that XRP is not considered a security for retail purposes, the SEC has filed an appeal. The appeal is set to be heard in the second quarter of 2024. At the time of publication, XRP’s price stands at $0.51.
Fortress Reports Customer Compromise
Fortress revealed a recent breach that compromised the accounts of four customers. The breach occurred through a third-party vendor whose cloud tools were compromised. However, Fortress assured that the accounts were fully restored and no funds were lost. The announcement from Fortress also hinted at upcoming “big company news.”
Past Acquisition by Ripple
Just four months prior, Ripple had disclosed a $250 million acquisition. In May, Garlinghouse announced the purchase of Swiss custody firm Metaco for $250 million.
Hot Take: Ripple’s Strategic Decision to Drop Fortress Trust Acquisition
Ripple’s decision to discontinue the acquisition of Fortress Trust may have been driven by various factors, such as changes in business strategy or due diligence findings. While the specifics remain undisclosed, it is clear that Ripple sees value in maintaining a partnership with Fortress Trust as an investor. This move allows Ripple to benefit from Fortress Trust’s technology and licensing while potentially exploring future collaboration opportunities. As Ripple continues to navigate regulatory challenges and expand its portfolio, strategic decisions like these will shape its path in the evolving crypto market.
By
By
By
By
By