Cryptocurrency startup Ripple could make a move to go public once the Silicon Valley blockchain platform settles its lawsuit with the Securities and Exchange Commission (SEC), Cointelegraph reported Thursday (April 29), citing SBI Group CEO Yoshitaka Kitao.
The chief of the Japanese financial giant said on an earnings call that Ripple CEO Brad Garlinghouse and its Executive Chair and Co-Founder Chris Larsen are looking into a public offering, per Cointelegraph.
Kitao also said that as Ripple’s largest backer, SBI Group could reap big benefits from a potential Ripple initial public offering (IPO), according to Cointelegraph.
“We have been investing in FinTech companies and we adopt that technology in our group and also we spread that technology across the industry. That is SBI Group’s basic strategy,” Kitao said, per Cointelegraph.
New York-headquartered R3, another blockchain consortium backed by SBI Group, is also exploring a public offering, Kitao said, per the FinTech and crypto news site.
The SEC filed a lawsuit against Ripple over its XRP cryptocurrency, alleging that the company held a $1.3 billion unregistered securities offering. The suit contends that Ripple should fall under SEC regulations because it is a security, not a currency.
The suit also alleges that Ripple was aware that it wasn’t likely XRP would qualify for status as a currency under the Exchange Act because it lacked the backing of a central government.
In response to the SEC lawsuit, Ripple said that the U.S. regulator is incorrect — Ripple’s XRP cryptocurrency is not a security. The company said XRP is a virtual coin used as a medium of exchange for international and domestic transactions. Ripple further added that XRP is an asset that is perfect for payment processing because it’s quick and scalable.
Ripple’s partnership with Moneygram fell apart in light of the SEC investigation. Both companies said the two could work together in the future after the lawsuit is settled. Moneygram is also facing a potential lawsuit by its investors over Ripple transactions.c