Ripple CEO Reveals Company Once Considered Shutting Down During SEC Fight

Ripple Chief Executive Brad Garlinghouse revealed that he and co-founder Chris Larsen seriously weighed shutting the company down and distributing its XRP holdings to shareholders rather than fighting the SEC in court. Speaking at the University of Kansas School of Business, Garlinghouse described this as the simpler path when facing a government agency he said had far greater resources and power than Ripple.

Choosing To Fight Instead

Garlinghouse said dissolving the company would have meant handing XRP to shareholders on a pro rata basis, effectively ending the lawsuit by ending Ripple itself. Ultimately, the two decided against it because shutting down would have cost hundreds of employees their jobs. He said he remains glad in hindsight, though the outcome was far from certain at the time.

The Case Against Ripple

The SEC sued Ripple in 2020, alleging the company sold XRP as an unregistered security, and named both Garlinghouse and Larsen personally in the suit. Garlinghouse said he met with agency officials four times between 2017 and 2019 without legal representation and was never warned that XRP could be treated as a security, a experience that shaped his belief the company had been denied clear regulatory guidance. He estimated Ripple’s total legal costs over the four-year battle at $150 million.

How The Case Ended

Ripple ultimately won a key ruling when Judge Analisa Torres determined that XRP itself is not a security. The two sides reached a settlement last year after new SEC leadership under the Trump administration adopted a more accommodating stance toward the crypto industry.