According to Forbes, Ripple has raised $500 million at a $40 billion valuation led by Fortress Investment Group and Citadel Securities, with participation from Pantera Capital, Galaxy Digital, Brevan Howard, and Marshall Wace. The deal follows a previous $1 billion tender offer at the same valuation and dramatically increased cofounder Chris Larsen’s net worth from $10.2 billion to $13.8 billion. CEO Brad Garlinghouse is now a billionaire with an estimated $3.5 billion fortune based on his 6% stake and XRP holdings. Arthur Britto, one of the XRP Ledger’s creators, also joined the billionaire ranks with at least 1.3 billion XRP worth roughly $3 billion. The company stated the funding reflects “strategic value of deepening relationships with financial partners” despite sitting on about 35 billion XRP tokens worth approximately $80 billion.
Sponsored content — provided for informational and promotional purposes.
The Unnecessary Cash Infusion
Here’s the thing that really stands out: Ripple didn’t actually need this money. They’re sitting on $80 billion worth of XRP tokens that get released from escrow every single month. That’s basically the most lucrative self-funding mechanism you could possibly imagine. So why take $500 million from Wall Street? It’s all about credibility and relationships. When Fortress and Citadel Securities put their names behind you, that’s Wall Street’s version of a seal of approval. But it does make you wonder – if they’re already this cash-rich, why dilute ownership?
From Zombie To Conglomerate
Just last year, Forbes called Ripple a “zombie blockchain” – one of those projects with inflated valuations despite limited real adoption. They’d struggled to convert early hype into sustained usage after their much-touted MoneyGram partnership fizzled. Then the SEC lawsuit hit in 2020, which they finally settled for $125 million in August. Rather than retreat, they went on an absolute acquisition spree. They bought treasury management software provider GTreasury for $1 billion, prime broker Hidden Road for $1.25 billion, stablecoin platform Rail for $200 million, and custody firms Metaco and Standard Custody. They’re basically buying all the financial plumbing they need to become a full-service crypto financial institution.
business-model”>The New Business Model
And you know what? It seems to be working. Ripple claims payment volumes have surpassed $95 billion, and their RLUSD stablecoin launched in December already hit $1 billion market cap. The Hidden Road acquisition brought them a business that was clearing $3 trillion annually across 300 institutional clients. Now they’re expanding into collateralized lending for XRP using their own stablecoin. They’ve completely pivoted from trying to replace SWIFT to becoming a one-stop shop for institutional crypto services. It’s a smart play, honestly – why fight the existing system when you can become the system?
The $179 Billion Question
But here’s the billion-dollar question – or rather, the $179 billion question. That’s the combined valuation being afforded to Ripple and its XRP token. Can this hodgepodge of acquired businesses really justify that number? The company’s sitting on massive token reserves, sure, but those could become a liability if regulators come knocking again. Their pivot to becoming a financial services conglomerate makes sense strategically, but they’re competing against established players who’ve been in this game much longer. The Wall Street backing gives them serious credibility, but it also means they’ve got some demanding new shareholders to answer to. This feels like a make-or-break transformation – either they become the Goldman Sachs of crypto, or this becomes one very expensive experiment.
