Why has Ripple become a compelling topic of interest
Ripple, the prominent blockchain company known for its cryptocurrency XRP, has recently made headlines for its involvement in politics. Ripple’s CEO, Brad Garlinghouse, has publicly praised Democratic presidential candidate Kamala Harris for her approach to digital assets, a surprising shift considering Ripple’s historical neutrality in U.S. elections and its contentious relationship with U.S. regulators, particularly the SEC. This shift towards Harris raises questions about Ripple’s motives and its future plans.
Ripple’s political pivot is particularly notable because of its past legal battle with the SEC. In 2020, Ripple faced a $1.3 billion lawsuit from the SEC during President Biden’s administration, accusing the company of selling unregistered securities in the form of XRP. While Ripple achieved a partial victory in July 2023 when a judge ruled that XRP sales to retail investors did not qualify as securities, the SEC has continued to pursue the case. In August 2024, the SEC sought a $2 billion fine, but was awarded a much smaller $125 million penalty. Ripple celebrated this as a victory, but the SEC’s ongoing appeal has created uncertainty.
Ripple’s recent political moves have been far from ordinary. Just a few months ago, Ripple’s Chief Legal Officer, Stuart Alderoty, made headlines with a substantial $300,000 XRP donation to former President Trump’s presidential campaign. This donation came at a time when Trump had shifted towards a pro-crypto stance, leading many to believe that his return to the White House would benefit the crypto industry. This raises questions about Ripple’s motivations and its strategy for survival.
It’s worth noting that while Ripple’s executives have shown split allegiances in their political donations, the broader crypto industry has heavily backed Trump. Recent data reveals that crypto companies have spent 62% more on ads for Republicans than Democrats this year. This spending is concentrated on key House races in states like New York, Nevada, and California.
Ripple’s dual strategy reflects the uncertainty surrounding the 2024 U.S. presidential election and its potential impact on the crypto industry. With political donations from crypto groups reaching $190 million for this election cycle, the stakes have never been higher. Ripple wants to ensure that it has a seat at the table, regardless of who wins the election.
In addition to its political involvement, Ripple is also eyeing the possibility of an XRP exchange-traded fund (ETF). Bitwise and Canary Capital have already filed for XRP ETFs, which, if approved, would allow investors to gain exposure to XRP through a stock exchange without directly owning the cryptocurrency. Garlinghouse has called an XRP ETF “inevitable” and believes there is growing demand from both retail and institutional investors. The approval of an XRP ETF would not only validate XRP as a legitimate financial asset, but it would also address the concerns raised by the SEC lawsuit.
Therefore, Ripple’s donations to both Harris and Trump could be a strategic maneuver to position the company for success, regardless of who wins the 2024 election. The approval of an XRP ETF would be a significant victory for Ripple, boosting confidence in XRP and potentially driving up its price and liquidity.
In conclusion, Ripple’s recent political involvement and its pursuit of an XRP ETF indicate a shift in strategy and a desire to secure its position in the crypto industry. The outcome of the 2024 U.S. presidential election will play a crucial role in Ripple’s future, and the company is positioning itself to benefit from either candidate’s favor.
