Ripple Grows Portfolio with Acquisition of Standard Custody & Trust amid Ongoing SEC Litigation
Summary:
Ripple has acquired US digital asset custody provider, Standard Custody & Trust Company, enhancing its regulatory licenses portfolio. Ripple holds nearly 40 money transmitter licenses and a New York BitLicense through its subsidiary XRP II. Ripple had also bought Swiss blockchain custody firm Metaco for $250 million. Meanwhile, it continues to face an SEC suit alleging the sale of unregistered securities via XRP tokens. Ripple obtained a substantial payment institution license from the Monetary Authority of Singapore and registration with the Central Bank of Ireland as a virtual asset service provider; the final acquisition still awaits regulatory approval.
Ripple has taken over Standard Custody & Trust Company, a digital asset holding provider based in the US. There was already an existing connection to Ripple through its executive body. Standard Custody & Trust Company, having received its charter from the New York State Department of Financial Services (NYDFS), offers custody and escrow services and is considered a qualified custodian in line with federal law. Ripple claims that Standard Custody's trust charter and money transmitter licenses will enhance its growing collection of regulatory licenses.
Ripple performs the dual role of managing a payment network and promoting the XRP (XRP) cryptocurrency. Ripple, along with its subsidiaries, boasts nearly 40 money transmitter licenses across US states and a New York BitLicense, it claimed. Ripple has possessed a BitLicense as a limited-purpose trust company through subsidiary XRP II since 2016. Ripple's CTO and cryptographer, David Schwartz, clarified that XRP II is a legal entity owned by Ripple, designed to prevent the need for total company regulation.
The specifics of the acquisition deal for Standard Custody & Trust have not been disclosed. This news follows the announcement of Metaco CEO Adrien Trecanni's resignation, although it's uncertain when Trecanni stepped down. Metaco, a Swiss blockchain custody firm, was bought out by Ripple for $250 million in May. As Ripple further incorporates custody into its products, along with Standard Custody, it plans to offer comprehensive payment and storage options to move, convert, and store value within blockchain and crypto.
Standard Custody & Trust exists as a branch of PolySign, a digital asset infrastructure firm established by Ripple co-founder Arthur Britto, who currently serves as PolySign's president. Britto remains a somewhat elusive public figure. He is one of the original co-founders of Ripple, then coined OpenCoin, alongside Chris Larsen and Jed McCaleb in 2012. He is also acknowledged as a co-creator of the XRP Ledger protocol. According to Schwartz, a member of PolySign's board, Britto is also a gaming developer.
In December 2020, the US Securities and Exchange Commission (SEC) launched a suit against Ripple and two of its executives, Brad Garlinghouse and Larsen, alleging that they sold unregistered securities in the form of XRP tokens. Ripple made a significant gain when a judge stated in a summary judgment that XRP was only classified as a security when sold to investors. This prompted the SEC to drop the cases against Garlinghouse and Larsen, however, its case against Ripple persists.
Ripple received a significant payment institution license from the Monetary Authority of Singapore in October, and virtual asset service provider registration with the Central Bank of Ireland in December. The approval of Standard Custody & Trust's acquisition by Ripple requires regulatory approval.
Published At
2/13/2024 9:28:47 PM
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