Ripple CEO Reveals Company Once Considered Shutting Down and Distributing XRP to Shareholders
Ripple CEO Brad Garlinghouse has disclosed that he and co-founder Chris Larsen seriously weighed winding the company down and handing its XRP holdings to shareholders before ultimately choosing to fight the SEC lawsuit filed in 2020. The revelation sheds new light on the existential stakes Ripple faced at the outset of the litigation. The decision to contest the case rather than dissolve the company now stands as a pivotal moment in XRP's regulatory and market history.
Ripple CEO Brad Garlinghouse has publicly acknowledged that in the early days of the SEC lawsuit, he and co-founder Chris Larsen considered shutting the company down entirely. Under the scenario they weighed, Ripple's XRP holdings would have been distributed directly to shareholders rather than retained by a continuing business entity.
The disclosure underscores how severe the threat of the 2020 SEC complaint was perceived to be internally. At the time, the lawsuit alleged that XRP itself was an unregistered security, creating uncertainty that stretched across exchanges, institutional partners, and the broader XRP ecosystem.
Instead of winding down, Garlinghouse and Larsen chose to mount a legal defense, a fight that culminated in a landmark 2023 federal court ruling that XRP sold on secondary markets did not constitute a security. That ruling has since been widely cited as one of the most consequential legal outcomes for the broader crypto industry.
The candid retrospective account reveals the degree to which the company's continued existence, and by extension the institutional development of the XRP ledger, was not a foregone conclusion. Had Ripple dissolved, the trajectory of RLUSD, ongoing XRPL development, and Ripple's institutional payment corridors would have been fundamentally different.
The comments add important historical context for XRP holders and market participants assessing the long-term significance of Ripple's legal strategy and its outcomes.
Key facts
- •CEO Brad Garlinghouse revealed Ripple considered shutting down after the 2020 SEC lawsuit was filed
- •Co-founder Chris Larsen was part of the wind-down deliberations
- •The plan would have involved distributing Ripple's XRP holdings to shareholders
- •Ripple ultimately chose to fight the lawsuit rather than dissolve
- •The 2023 federal court ruling found XRP on secondary markets was not a security
- •The disclosure is a retrospective account, not a new regulatory development