In a strategic move announced during the past few days, Ripple Labs, the renowned financial technology firm, has taken a significant step towards expanding its regulatory influence in the United States. The firm has acquired Fortress Trust, a Nevada-based company specializing in regulatory and technology infrastructure for blockchain organizations.
This acquisition is a testament to Ripple's dedication to bolstering its regulatory compliance and infrastructure capabilities. With more than 30 licenses as a money transmitter across the United States, including the coveted BitLicense in New York, this acquisition adds to Ripple's extensive list of licenses, further solidifying its position as a leading player in the cryptocurrency space. Furthermore, Monica Long, President at Ripple, emphasized the importance of licenses in providing top-tier customer experiences for enterprises, underscoring how Fortress Trust's technology and licensing seamlessly align with Ripple's business roadmap.
Ripple Adds to Its Expansive List of Licenses
The financial technology firm Ripple Labs has taken a significant step in expanding its regulatory foothold in the United States through the acquisition of Fortress Trust, a company specializing in regulatory and technology infrastructure for blockchain organizations. This strategic move was announced on 8 September 2023, marking Ripple's commitment to strengthening its regulatory compliance and infrastructure capabilities.
Fortress Trust, based in Nevada, holds a valuable Nevada Trust license that grants it the authority to custody financial assets. This acquisition complements Ripple's existing regulatory licenses, which include over 30 licenses across the United States as a money transmitter. Furthermore, Ripple holds a BitLicense in New York, a crucial requirement for digital currency businesses operating within the state.
Monica Long, President at Ripple, emphasized the importance of licenses in enabling the creation of top-tier customer experiences for enterprises. According to Ripple's official announcement, Fortress Trust's technology and licensing align seamlessly with Ripple's business and product roadmap.
Ripple’s Relationship With Fortress Trust
Ripple's association with Fortress Trust dates back to 2022 when the company initially invested in Fortress Blockchain Technologies through a seed round. While specific financial terms of the recent acquisition were not disclosed, it underscores Ripple's commitment to fortifying its position in the blockchain and cryptocurrency space.
Brad Garlinghouse, CEO of Ripple, commended Fortress Blockchain Technologies for its impressive progress since its launch in 2021. The company has achieved recurring revenue and established a robust clientele that includes both crypto-native and newcomers to the cryptocurrency sector.
Ripple’s Acquisition Drive
Ripple has been proactive in pursuing strategic acquisitions, even during bearish market conditions. In May of this year, Ripple made headlines with its acquisition of Metaco, a Swiss digital asset custodian and tokenization provider, in a deal worth $250 million. This strategic expansion aligns with Ripple's anticipation of a wave of acquisitions in the cryptocurrency space in 2023, which will help companies fill gaps in their capabilities.
As part of its investment strategy, Ripple plans to support Fortress Trust's parent company, Fortress Blockchain Technologies, and its affiliated entity, FortressPay services. Ripple continues to expand its global presence, serving clients in over 55 countries by offering payout services through blockchain technology.
The acquisition of Fortress Trust is a significant milestone for Ripple, enabling the company to further strengthen its regulatory compliance and enhance its ability to provide cutting-edge blockchain solutions to businesses and enterprises across the United States and around the world.
The SEC Delivers a Response in the Ripple Case
In related news, the United States Securities and Exchange Commission (SEC) has taken a significant step in the ongoing legal battle with Ripple Labs Inc. by filing a reply brief in support of its motion to certify an interlocutory appeal. This development comes in the wake of complex legal proceedings and marks another chapter in the SEC's efforts to assert regulatory control over Ripple's XRP cryptocurrency.
In its reply memorandum, the SEC seeks certification for appellate review, citing several key reasons:
Controlling Case Laws: The SEC argues that there are controlling case laws that warrant an interlocutory appeal, indicating a need for clarification and guidance from higher courts.
Substantial Grounds for Difference of Opinion: The Commission asserts that substantial differences of opinion exist on critical legal questions, highlighting the need for appellate review to address these issues.
Advancing Case Termination: The SEC contends that an interlocutory appeal would significantly advance the termination of the case, potentially saving both time and resources.
Stay Pending Appeal: The SEC emphasizes the importance of a stay pending appeal to conserve judicial resources and ensure a fair and efficient resolution of the matter.
One of the central issues in the case revolves around programmatic sales and other distributions related to XRP. The SEC argues that these issues are primarily legal questions and that the defendants are attempting to complicate matters by introducing factual disputes.
Moreover, the SEC challenges Ripple's characterization of the Terraform Labs case, arguing that it misrepresents the status of the Howey test in secondary market resales of assets. The SEC contends that Ripple is ignoring pivotal Supreme Court and Second Circuit cases related to the Howey guideline, which are crucial to the interlocutory appeal certification.
The SEC further alleges that Ripple lacks an institutional interest in efficiently resolving the case and suggests that the defendant's objective is to prolong litigation, providing them with more time to continue selling XRP in public markets.
In its concluding remarks, the SEC asserts that the certification of an interlocutory appeal would serve the interests of resource preservation for both the Court and the parties involved. The SEC urges the Court to grant its motion for an interlocutory appeal and to stay further proceedings until the resolution of this appeal.
As the legal battle between the SEC and Ripple unfolds, the cryptocurrency industry continues to watch closely, as the outcome of this case could have significant implications for the regulation of cryptocurrencies and digital assets in the United States.
As Ripple presses forward with its regulatory woes and triumphs, the cryptocurrency price tracking website CoinStats indicated that XRP was trading hands at $0.499771 at press time. This was after the remittance token’s price slipped 0.7% throughout the past 24 hours. Consequently, the altcoin’s weekly performance had also been dragged into the red zone to -0.59%.
Price chart for XRP (Source: CoinStats)
In addition to weakening against the Dollar, XRP was also outdone by Bitcoin (BTC) over the past 24 hours, as the market leader had outshined the altcoin by 0.5% during this period. Subsequently, 1 XRP was estimated to be worth around 0.00001935 BTC.
Daily chart for XRP/USDT (Source: TradingView)
From a technical perspective, XRP’s price was resting on a positive trend line that had formed on its daily chart over the past 2 weeks. Therefore, a break below this line may result in the remittance token’s short-lived bullish trend coming to an end. Moreover, XRP’s price may retest the immediate support level at $0.4715 in the following couple of days.
If this potential sell pressure persists, then XRP’s price may also be at risk of falling to the crucial support level at $0.4430 as well in the coming week. However, a daily candle close above the 9-day EMA line at around $0.5058 within the next 48 hours may invalidate the bearish thesis. In this scenario, XRP’s price may attempt to flip the resistance level at $0.5380 into support soon. Thereafter, continued buy support could lead to the remittance token’s price reaching as high as $0.5890 over the next week.
Investors and traders will want to take note of the fact that short-term momentum was in favor of bears at press time before deciding to enter into a long position for XRP. Firstly, the 9-day EMA line was positioned bearishly below the 20-day EMA line. Furthermore, a significant bearish technical flag was triggered on XRP’s daily chart, as the daily RSI line crossed below the RSI SMA line throughout the past 24 hours of trading. These technical flags suggested that the remittance token’s price may drop in the coming 24-48 hours.
Disclaimer: Coinpaper does not recommend that any cryptocurrency should be bought, sold, or held by you. Always conduct your own research and consult your financial advisor before investing in any digital asset.