CoinDesk
Ripple Chief Executive Brad Garlinghouse disclosed this week that he and co-founder Chris Larsen seriously considered winding the company down and distributing its XRP holdings to shareholders after the SEC sued in 2020, before opting to fight the case in court. Speaking at the University of Kansas School of Business, Garlinghouse said the dissolution path was the easier route against a government with what he called "infinite power and resources."
He put Ripple's legal bill at roughly $150 million over the four-year fight, a tab the company absorbed to preserve hundreds of jobs that would have been lost in a shutdown. The SEC had named Garlinghouse and Larsen personally in the suit alleging that Ripple sold XRP as an unregistered security. Garlinghouse said he met agency officials four times between 2017 and 2019 without a lawyer and was never told XRP might be treated as a security, a detail he uses to argue the company was denied clear rules.
Why it matters
The disclosure reframes Ripple's posture during the case from confident defence to survival calculus. Garlinghouse's account implies the company would have existed only as a shell distributing XRP to shareholders if a wind-down path had been taken, a scenario that would have left XRP without a corporate sponsor managing supply and ecosystem spend. His decision to invoke the absence of regulatory guidance between 2017 and 2019 also feeds a longer-running industry complaint that the SEC's enforcement-led approach left token issuers without a compliance roadmap.
Market impact
The legal outcome still anchors XRP's regulatory profile. Judge Analisa Torres ruled that XRP in itself is not a security, a precedent the rest of the industry has cited in subsequent cases, and the two sides settled in May of last year after new SEC leadership adopted a more accommodating stance toward crypto. XRP itself traded little changed on the remarks, which read as historical commentary rather than a fresh catalyst. The substantive market signal sits in the $150M legal-cost figure, a benchmark that quantifies the cost of an SEC fight for any issuer weighing whether to settle early or litigate to verdict.
Frequently asked questions
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What did Ripple's CEO say about shutting down the company?
Brad Garlinghouse said he and co-founder Chris Larsen seriously considered dissolving Ripple and distributing its XRP holdings to shareholders after the SEC sued in 2020, before deciding to fight the case in court to preserve hundreds of jobs.
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How much did Ripple spend fighting the SEC?
Garlinghouse put Ripple's legal costs at roughly $150 million over the four-year fight, a tab the company absorbed rather than settling early or winding down.
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What was the outcome of the SEC lawsuit against Ripple?
Judge Analisa Torres ruled that XRP in itself is not a security, and the two sides settled in May of last year after new SEC leadership adopted a more accommodating stance toward crypto.
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Why does Garlinghouse say the company was treated unfairly?
He said he met SEC officials four times between 2017 and 2019 without a lawyer and was never told XRP might be treated as a security, a detail he uses to argue Ripple was denied clear rules before being sued.
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How did XRP price react to the remarks?
XRP traded little changed on the comments, which read as historical commentary rather than a fresh market catalyst, though the $150M legal-cost figure is now a benchmark for issuers weighing whether to settle early or litigate.
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