Regulatory Friction Prompts Ripple to Explore IPO Outside US, Ripple CEO Confirms

Ripple CEO Brad Garlinghouse has confirmed that the blockchain payment company has explored markets outside the U.S. for its potential initial public offering (IPO).

This disclosure came while responding to inquiries from a CNBC journalist at the ongoing World Economic Forum (WEF) in Davos, Switzerland.

According to Garlinghouse, the decision to explore alternatives comes as a response to the unyielding legal battle with the U.S. Securities and Exchange Commission (SEC). 

Specifically, Garlinghouse disclosed Ripple’s consideration of environments with transparent and well-defined rules for crypto companies as potential venues for a public listing.

“We looked at other jurisdictions that have clear rules of the road,” the Ripple executive noted.

Yet, IPO Plans Remain on Hold

Meanwhile, Garlinghouse revealed that the firm has temporarily shelved its IPO plans. The Ripple CEO cited the challenging regulatory landscape in the U.S. as a major deterrent.

This is despite previous statements indicating Ripple’s intention to go public after concluding its legal dispute with the SEC. In Garlinghouse’s words:

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“In the United States, trying to go public with a very hostile regulator that has to approve your S-1 doesn’t sound like a lot of fun to me.”

Furthermore, in backing up his view about the hostile U.S. regulatory climate, Garlinghouse pointed out the irony of the Coinbase case.

In particular, he cited that Coinbase had its IPO registration statement approved by the SEC. However, the SEC subsequently filed a lawsuit against Coinbase for actions explicitly outlined in the S-1 filing.

As a result, he remarked: “Why would we want to subject ourselves to an SEC that is openly hostile to this industry.”

Despite the regulatory uncertainty, USDC stablecoin issuer Circle has filed a confidential submission to IPO in the U.S. The Crypto Basic called attention to this development in a recent report.

Ripple Bought Back $1B Shares

While keeping the IPO option open, Garlinghouse clarified that going public is not an immediate priority for Ripple. He emphasized that many companies choose to go public to raise capital. In contrast, Ripple has no immediate need for capital infusion. 

On the other hand, he mentioned the company has focused on providing liquidity to its shareholders. Specifically, Ripple’s CEO revealed the firm has bought back $1 billion worth of its stock from equity holders.

“We have investors that first invested in Ripple in 2012. So they’ve been in this deal for eleven-and-a-half years. And so we want to provide that liquidity, which is one of the reasons why we’ve done these tender offers,” the executive confirmed.