Ripple CEO Clarifies 4.7 Million Shares Held by Bankrupt Linqto

Ripple, a leading blockchain company, has been thrust into the spotlight following the bankruptcy of Linqto, an investment platform that facilitated the trading of private company shares, including those of Ripple. This development has sparked concerns among Ripple investors who had purchased shares through Linqto, prompting Ripple's CEO, Brad Garlinghouse, to address these worries and provide clarity to the community.

Garlinghouse confirmed that Linqto holds 4.7 million shares of Ripple, which were acquired exclusively on the secondary market from existing Ripple shareholders, not directly from Ripple. He emphasized that Ripple has never had a business relationship with Linqto and that the company ceased approving secondary market purchases through Linqto in late 2024 due to growing concerns. This clarification is essential as it separates Ripple's operations and share value from the legal and financial troubles faced by Linqto.

The CEO also clarified the distinction between XRP tokens and Ripple shares, stressing that the issue pertains only to Ripple shares held by Linqto and not the cryptocurrency itself. He acknowledged that he has no knowledge of how Linqto managed its clients or sold ‘representative units’ of Ripple shares, but confirmed that Linqto owns those 4.7 million shares, and their value has increased over time. This reassurance is significant as it underscores the stability of Ripple's share value despite the challenges faced by Linqto.

John Deaton, an attorney, noted the importance of Linqto's legal structure, which prioritizes its 11,500 SPV investors over creditors. This structure is designed to safeguard investors and offers a glimmer of hope amidst the bankruptcy proceedings. Deaton's reassurance provides stability, clarifying Ripple's lack of involvement with Linqto amid broader impacts on SPV investors.

The bankruptcy of Linqto and the ongoing federal investigations have shed light on the complexities and risks associated with investing in private companies through cryptocurrency platforms. The incident underscores the importance of transparency and accountability in the industry, as well as the need for robust regulatory frameworks to protect investors. It also highlights the interconnected nature of the cryptocurrency ecosystem, where the actions of one player can have ripple effects throughout the industry.

As the situation continues to unfold, Ripple and its leadership will need to navigate these challenges carefully to maintain investor confidence and ensure the company's long-term viability. The outcome of this scandal will likely have far-reaching implications for the future of cryptocurrency investments and the regulatory landscape in which they operate. It is crucial for all stakeholders to work together to address these issues and promote a more stable and secure environment for investors.