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Ripple leaders weighed shutting down after SEC lawsuit in 2020

Garlinghouse estimated the four-year legal battle cost Ripple about $150 million, including a $125.04 million civil penalty and an injunction that remained in effect after the SEC’s appeals were dismissed.

Reported · Written up by our desk · Regulation

Ripple CEO Brad Garlinghouse said he and co-founder Chris Larsen seriously considered shutting down Ripple after the U.S. Securities and Exchange Commission sued the company in 2020. In a KU Hustle interview, Garlinghouse said the SEC also distributed Ripple’s XRP holdings to shareholders, prompting leadership to consider whether winding down would be the safer path.

Garlinghouse said the team chose to keep fighting rather than close the company, and he tied the decision to preserving jobs. He estimated the legal battle took roughly four years and cost the firm about $150 million in total.

The executive noted the SEC’s August 2025 litigation release dismissed the appeals, while the district court’s final judgment continued to apply. That judgment included a $125.04 million civil penalty and an injunction against Ripple.

Garlinghouse also clarified that the discussion concerned shutting down Ripple as a company, not ending the XRP Ledger or transferring XRP held by the public. He said Ripple and Larsen considered winding down and distributing Ripple’s XRP holdings to shareholders on a pro rata basis, adding that the XRP reserve provided leverage when leadership faced the choice between continued litigation and shutting down.

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