That old scammer in the crypto world quietly bought his way into becoming a trading giant

The cloud of litigation from the U.S. Securities and Exchange Commission (SEC) has finally dissipated, and Ripple Labs, a company long claiming to be a blockchain payments firm but with little actual business, has finally embarked on an acquisition path, moving toward building a multi-billion-dollar, truly substantial cryptocurrency empire.

Ripple Labs CEO Brad Garlinghouse (Brad Garlinghouse). Image source: Stephen McCarthy/Sportsfile/Collision/Getty Images

In March 2024, we published a report on “zombie blockchains,” listing at least 50 cryptocurrency projects with market caps over $1 billion, mainly supported by speculation rather than real-world applications. Ripple, which once aimed to replace the global banking information service SWIFT but failed to achieve its ambitions, topped the list.

At that time, its market cap reached $36 billion, yet its annual fee revenue was only $583,000.

But recently, Ripple Labs has been developing rapidly.

In the private market, the company’s share price is currently fluctuating between $135 and $170, up about 2 to 3 times since the beginning of the year, with a valuation between $22 billion and $30 billion. For reference, this valuation is already close to that of stablecoin issuer Circle. Ripple has ambitions to compete with Circle and even attempted to acquire it before its IPO in June. Currently, Circle’s valuation is about $34 billion, and its share price has risen 352% since its June 5 IPO. Ripple’s token XRP (which does not grant holders ownership of the company) has surged 366% so far this year, with a market cap approaching $150 billion.

Ripple has now also caught the wave of the digital asset treasury boom.

In recent weeks, several companies have announced treasury strategies centered around XRP, with the most notable being Evernorth, which plans to raise over $1 billion. For a company that has long struggled to make business progress, the fact that enterprises are willing to consider holding its token demonstrates their great trust in Ripple.

With Ripple’s five-year legal dispute with the SEC coming to an end, such a transformation is not surprising.

In 2020, the SEC sued Ripple, accusing it of selling XRP as an unregistered security. The final result was Ripple paying a $125 million fine. In addition, Ripple has completed several high-profile acquisitions: acquiring treasury management software provider GTreasury for $1 billion, prime broker Hidden Road for $1.25 billion, and stablecoin payment platform Rail for $200 million. Between 2023 and 2024, Ripple also acquired digital asset custody company Metaco (for $250 million) and Standard Custody (acquisition amount undisclosed).

Although in terms of application usage and developer activity, the XRP Ledger still lags behind other more popular blockchains, it is clear that today’s Ripple is very different from a year ago.

“Sometimes people think change is bad, but I believe it’s actually a sign of healthy development and moving toward excellence, especially in emerging technology fields,” said Joe Naggar, CEO and CIO of crypto hedge fund Feynman Point Asset Management, which is also one of Ripple’s investors.

He added, “Ripple has always had a meticulous approach to capital structure, but this was not fully reflected before due to regulatory pressure. I think Ripple vividly demonstrates how a company can develop without a harsh legislative and regulatory environment. This careful consideration also sets Ripple apart from other protocols with large treasuries—those foundations behind the protocols lack real leadership and don’t know whom they serve. But if you ask Brad Garlinghouse (Ripple’s CEO), his answer will be very clear: to serve shareholders.”

Naggar believes that if you want to find a reference point for Ripple today, it should not be Circle or other blockchain companies, but Coinbase. Coinbase also conducts custody and prime brokerage business and has a revenue-sharing agreement with Circle.

Austin King, CEO of crypto trading firm Nomina (who sold his first company to Ripple in 2019), has an even more pointed view: “There are a lot of people in crypto who have criticisms of Ripple, but the fact is, Ripple has amazing vision. Their technology has existed for ten years. I think Ripple’s current bet is to find synergies among these different businesses and integrate them into a comprehensive financial services group.”

Therefore, Ripple’s next major question is whether it can integrate its acquired businesses into a unified system, thereby truly creating value for its core technology—the XRP Ledger.

This article is translated from:

Author: Nina Bambysheva

Translation: Lemin

Original title: “Ripple Labs’ $180 Billion Transformation Journey”