Ripple CEO Postpones U.S. IPO Amidst SEC Critique, Highlighting Regulatory Challenges

The Ripple-SEC case, ongoing since 2020, reached a partial victory for Ripple in July 2023. However, Ripple CEO Brad Garlinghouse has made significant statements at the Davos event regarding the current status and future plans in light of the SEC's regulatory stance.

Hostile SEC and Suspended IPO Plans

During an interview with CNBC, Garlinghouse characterized the SEC as a hostile regulator to the cryptocurrency industry. He disclosed that Ripple has decided to suspend its initial public offering (IPO) plans in the U.S. due to the SEC's actions and unfavorable regulatory environment.

Garlinghouse emphasized that, given the SEC's stance towards crypto companies, Ripple is in no hurry to pursue public offering plans in the U.S. He highlighted the preference for exploring markets outside the U.S. that provide clearer regulatory rules.

Exploring Other Jurisdictions

In response to the SEC's actions, Garlinghouse mentioned that Ripple is actively exploring "other jurisdictions with clear rules" as potential locations for the company to go public. This strategic decision reflects Ripple's cautious approach in response to regulatory challenges within the U.S.

“We are in no rush to go public in the US. As long as there is a regulator in the US who approves S-1s but is very hostile, trying to explain it to the public doesn't sound like much fun to me," Garlinghouse stated.

Postponed IPO in the U.S.

Despite having previously considered going public in the U.S., Ripple has decided to put those plans on hold for the time being. Garlinghouse explained that the current regulatory climate, coupled with the SEC's actions, has shifted Ripple's priorities away from a U.S.-based IPO.

Reconsideration Conditional on SEC Chairman Change

Garlinghouse expressed a willingness to reconsider going public in the U.S., but with a condition. He stated that Ripple would reassess its IPO option when a new chairman assumes leadership at the SEC. The CEO indicated that a change in leadership could potentially alter the regulatory landscape, making it more favorable for Ripple's IPO plans in the U.S.

Share Buyback and Providing Liquidity

In a separate development, Garlinghouse confirmed that Ripple has repurchased $1 billion worth of shares. He noted that the company has been providing liquidity to investors interested in Ripple since its inception 12 years ago.

In summary, Ripple's CEO sheds light on the company's decision to delay U.S. IPO plans due to the SEC's hostile regulatory stance, exploring alternative jurisdictions and expressing openness to reconsideration contingent on changes in SEC leadership. Additionally, the confirmation of a significant share buyback reflects Ripple's commitment to providing liquidity to its investors.