In 2020, the Security Exchange Commission (SEC) filed a lawsuit against the crypto firm Ripple, owner of XRP. In this case, the SEC accused the company of disguising unregistered securities as XRP tokens and selling them. The shares that were sold are labelled “Series C.”
The financial group, Tetragon, bought about $200 million shares from Ripple. This action was why the SEC filed a lawsuit against the fintech organization. To close the dispute and put matters to rest, Ripple decided to repurchase the shares from Tetragon.
After the crypto-exchange bought the shares, the company’s market value increased to about $15 billion. This sudden hike has attracted a mixed reaction from the public, with some seeing it as a wrong decision.
CEO Of Ripple Optimistic as The Company Buys Back Shares
Brad Garlinghouse, the CEO of Ripple, announced the buyback on his Twitter page. Garlinghouse also told the public about the recent increase in the company’s market value.
Although the company experienced some setbacks in 2021, the CEO noted that Ripple accumulated over $1 billion, a new record. Garlinghouse is optimistic that 2022 will be better.
During the lawsuit, the company sealed partnerships with several international banks. These partnerships were to incorporate crypto services into the financial institutions creating various payment options.
Mixed Reaction From The Crypto Community
The tweet from CEO of Ripple Company, Brad Garlinghouse was a positive message to its fans and users but there were some negative reactions.
The company’s lawsuit with Tetragon is why many people are not buying the positive speech of the CEO. In 2019, Ripple raised over $200 million in funding for Series C with Tetragon. Other firms that joined the fundraising are Route 66 Ventures and SBI Holdings. Tetragon filed a case to get back its funds. The dispute between SEC and Ripple had not been resolved during the lawsuit, and Tetragon did not win the case.
So, it is understandable why many people are not happy about the buyback. Many questions are left unanswered. Why did the company buy back the share? How will the buyback affect the ongoing crises with the SEC?
Other market participants are happy about the move and believe the company will win the case. Also, it could be that the company is trying to minimize its loss if they lose the case.
It is still unclear why Ripple bought back the share as it did not explain their action. At the moment, the market is moving in their favor, and they are hopeful that the market value will continue to go up.