Ripple CEO Brad Garlinghouse revealed that Ripple nearly shut down after the U.S. Securities and Exchange Commission sued the company in December 2020. Garlinghouse stated that Ripple's leadership seriously considered winding down the business, including a proposal to distribute XRP holdings to shareholders and close operations. Instead, Garlinghouse and Ripple co-founder Chris Larsen chose to fight the SEC in court, arguing that closure would cost hundreds of jobs and hand regulators a victory without legal challenge. The lawsuit marked one of the toughest periods in Ripple's history, with major U.S. exchanges suspending XRP trading and regulatory uncertainty overshadowing the company's prospects for nearly two years.
Ripple Leadership Chose Litigation Over Closure in December 2020
Market analyst Xaif Crypto highlighted that Garlinghouse said Ripple's leadership seriously considered winding down the business. One proposal involved distributing the company's XRP holdings to shareholders, informing regulators that Ripple no longer owned XRP, and shutting its doors. Garlinghouse and co-founder Chris Larsen chose to fight the SEC in court instead. According to Garlinghouse, closing the company would have cost hundreds of employees their jobs while handing the SEC a victory without its legal arguments ever being challenged. Convinced the case would shape the future of the broader crypto industry, Ripple decided to defend itself rather than walk away.
The lawsuit marked one of the toughest periods in Ripple's history. Major U.S. exchanges, including Coinbase, suspended or delisted XRP trading, liquidity declined, and many investors believed the project was finished. For nearly two years, regulatory uncertainty overshadowed Ripple's business and XRP's prospects in the U.S. Despite the pressure, Ripple continued expanding globally. The company added new payment partners, grew its enterprise blockchain business, and invested in infrastructure while battling the SEC in one of the industry's most consequential legal disputes.
Ripple Secured Licenses and Launched RLUSD After SEC Case Resolution
The SEC case was fully resolved in August last year, lifting a major regulatory overhang. Since then, Ripple has rebuilt its U.S. presence, secured licenses in multiple jurisdictions, expanded institutional partnerships, launched the RLUSD stablecoin, and strengthened its position in tokenization and cross-border payments. Xaif Crypto said Ripple's recovery shows how quickly market narratives can change. A company many believed was finished in 2020 has re-emerged as a leading force in institutional blockchain adoption, with banks and financial institutions increasingly exploring its technology for real-world financial applications.
For Garlinghouse, choosing to fight instead of fold became the defining moment in Ripple's history. What once appeared to be the company's final chapter ultimately became one of the crypto industry's most significant legal victories, cementing Ripple's resilience and setting the stage for its next phase of growth.
FAQ
What did Ripple's leadership consider after the SEC sued the company in December 2020?
Ripple's leadership seriously considered winding down the business. One proposal involved distributing the company's XRP holdings to shareholders, informing regulators that Ripple no longer owned XRP, and shutting its doors.
When was the SEC case against Ripple fully resolved?
The SEC case was fully resolved in August last year.
What actions did Ripple take after the SEC case resolution?
Ripple rebuilt its U.S. presence, secured licenses in multiple jurisdictions, expanded institutional partnerships, launched the RLUSD stablecoin, and strengthened its position in tokenization and cross-border payments.
