Ripple to Buy Back Its Shares at a Valuation of $11.3 Billion

Ripple, the cryptocurrency and blockchain-based fintech company, has announced its plans to repurchase its own shares with a valuation of $11.3 billion. This significant move follows their recent legal victory against the U.S. Securities and Exchange Commission (SEC).

The buyback program will see Ripple allocate $285 million towards purchasing shares from early investors, allowing them to sell up to 6% of their holdings. In total, the company plans to spend $500 million on this initiative, which includes expenses related to converting restricted stock units into shares and covering taxes.

Ripple's CEO, Brad Garlinghouse, confirmed the company's financial strength, with $1 billion in cash reserves and $25 billion in digital assets, primarily in XRP. Despite their financial stability, Garlinghouse ruled out an initial public offering (IPO) in the United States due to regulatory uncertainties. Instead, he pledged to expand the share buyback program, making it a regular occurrence.

This buyback offer became possible after Ripple's partial victory in a longstanding legal battle against the SEC, which began in 2020. In July 2023, Judge Analisa Torres ruled that the sales and distributions of XRP tokens did not constitute investment contracts. However, the distribution of the asset to institutional industry participants violated securities laws.

Ripple continues to make strategic moves, having recently agreed to acquire Switzerland-based infrastructure company Metaco for $250 million. In light of recent events, Garlinghouse humorously suggested that the SEC should investigate "itself" following a security breach involving an X-account.