Ripple almost didn’t make it. Brad Garlinghouse, the company’s CEO, revealed that Ripple seriously considered shutting down operations after the SEC filed its lawsuit against the firm in December 2020.
Speaking at the KU School of Business, Garlinghouse pulled back the curtain on what he described as an existential moment for the company, one where the leadership team had to decide whether fighting the US government was worth the risk of losing everything.
The lawsuit that almost ended Ripple
The SEC sued Ripple Labs on December 22, 2020, alleging that the company had conducted unregistered sales of XRP worth over $1.3 billion. In the eyes of the regulator, XRP was a security, and Ripple had been selling it without following the rules that govern securities offerings.
Garlinghouse emphasized the massive resource imbalance between a private company and a government regulator. The choice was binary: settle and potentially admit wrongdoing, or fight and risk bankruptcy. Ripple chose to fight. That decision turned into one of the longest and most consequential legal battles in crypto history.
