Ripple Abandons $15M Deal but Stays as Investor
Ripple, the cryptocurrency company, has unexpectedly decided not to proceed with the complete acquisition of Fortress Trust. Ripple’s CEO, Brad Garlinghouse, confirmed this through a tweet. However, Ripple will remain an investor in Fortress Trust.
Is it a Security Breach That Triggers Reevaluation
The cancellation of the deal is partly due to a recent security breach at Fortress Trust. The breach compromised one of its third-party vendors and cloud tools, resulting in a substantial loss of $12 million to $15 million in cryptocurrency.
Ripple Steps In to Cover Loss
Ripple has extended financial assistance to Fortress Trust to cover the multi-million-dollar loss caused by the security breach. It is reported that Ripple will likely recoup the $15 million it provided once funds are retrieved from the third party involved in the hack.
Ripple’s internal Issues?
Internal divisions within Ripple played a role in the breakdown of the acquisition deal. Some employees expressed reservations about the plan, contributing to the decision to withdraw from the acquisition.
Potential Implications for Other Companies
The withdrawal from the deal could have implications for other companies associated with Fortress Trust. Swan Bitcoin, currently engaged in a joint venture with BitGo, may see changes in its business operations as its direct association with Fortress Trust through Ripple ceases.
Legal Battles Persist for Ripple
Ripple is still facing a high-profile legal battle against the U.S. Securities and Exchange Commission. Despite this, its native token XRP has experienced a modest boost and remains the fifth-largest cryptocurrency in the market.
Hot Take: Ripple’s Decision Raises Questions About Future Partnerships
Ripple’s decision to abandon the $15 million deal with Fortress Trust raises questions about its future partnerships and acquisitions. The security breach and internal divisions within Ripple have contributed to this unexpected turn of events. While Ripple remains an investor in Fortress Trust, the withdrawal from the acquisition deal may have implications for other companies associated with Fortress Trust. Additionally, Ripple continues to face legal battles, highlighting the challenges it faces in the cryptocurrency industry.
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