Why has Ripple become a topic of interest

Ripple, the prominent blockchain company behind XRP, has recently taken a more active role in politics, particularly with regards to Democratic presidential candidate Kamala Harris. This shift in focus has raised questions about Ripple’s motives and what it could mean for the future of the company and its cryptocurrency, XRP.

Historically, Ripple has maintained a neutral stance in US elections and has had a strained relationship with US regulators, particularly the Securities and Exchange Commission (SEC). However, during the D.C. Fintech Week event, Ripple CEO Brad Garlinghouse praised Harris for her approach to digital assets, calling it “most constructive.” This endorsement is surprising considering Ripple’s past disputes with the SEC under President Biden’s administration.

The timing of Garlinghouse’s comments is significant, as Ripple is currently exploring the possibility of launching an XRP exchange-traded fund (ETF) and dealing with the aftermath of its legal battle with the SEC. It appears that Ripple is trying to position itself favorably under a Democratic administration and secure support for its ETF plans.

Traditionally, Ripple has not been aligned with the Democratic Party, especially after facing a $1.3 billion lawsuit from the SEC during President Biden’s tenure. However, Ripple CEO Chris Larsen has made substantial donations to Harris’ campaign, including a $10 million donation in XRP. This move is surprising, considering that many in the crypto industry view former President Trump as more supportive of digital assets.

Garlinghouse defended Larsen’s decision, stating that Ripple encourages its employees to support candidates they believe are best for the country. He emphasized that this is about promoting pro-crypto policies rather than loyalty to a particular political party. Garlinghouse believes that the outcome of the 2024 election is crucial for the future of the crypto industry and that both Harris and Trump would improve upon the Biden administration’s approach.

Ripple’s relationship with Democrats, particularly the SEC, has been contentious. The SEC filed a lawsuit against Ripple in 2020, accusing the company of selling unregistered securities in the form of XRP. Despite a partial victory for Ripple in July 2023, the SEC continues to pursue the case and recently sought a $2 billion fine. Ripple sees the reduced penalty of $125 million as a victory, but the SEC’s ongoing appeal adds to the uncertainty surrounding the company.

Ripple’s recent political moves have been unconventional. Just a few months ago, Ripple’s Chief Legal Officer, Stuart Alderoty, donated $300,000 in XRP to Trump’s campaign. This donation coincided with Trump’s pro-crypto stance, which could have influenced Alderoty’s decision. The broader crypto industry has also shown support for Trump, with high-profile donors and significant ad spending on Republican candidates.

Ripple’s dual strategy reflects the uncertainty surrounding the 2024 US presidential election and its potential impact on the crypto industry. With crypto groups contributing $190 million to political donations for this election cycle, the stakes are high. Whether it’s Trump or Harris in the Oval Office in 2025, Ripple wants to ensure that it has a say in shaping crypto regulations.

One possible strategic maneuver for Ripple is its support for both Harris and Trump. This could be an attempt to position itself favorably with either candidate and increase the chances of getting approval for an XRP ETF. Bitwise and Canary Capital have already filed for XRP ETFs, and Ripple’s CEO has called an XRP ETF “inevitable.” If approved, an XRP ETF would validate XRP as a legitimate financial asset and address concerns raised by the SEC lawsuit. It would also meet investor demand in a regulated manner, potentially boosting XRP’s price and liquidity.

In conclusion, Ripple’s recent political involvement, including donations to Harris and Trump, is part of a strategic maneuver to secure support for its XRP ETF plans. The outcome of the 2024 election holds significant implications for the future of Ripple and the crypto industry as a whole.