Brad Garlinghouse revealed that he and co-founder Chris Larsen once debated shutting down Ripple and distributing its XRP to shareholders instead of fighting the 2020 lawsuit.
He said the company seriously considered closing its doors rather than taking on the U.S. Securities and Exchange Commission, describing the challenge of battling an agency with vast resources and authority.
Speaking at the University of Kansas School of Business earlier this week, Garlinghouse explained that dissolving Ripple and allocating its XRP holdings to shareholders on a pro rata basis would have effectively ended the legal dispute.
Ultimately, however, the leadership chose to fight, emphasizing that shutting down would have led to the loss of hundreds of jobs. Looking back, Garlinghouse said he is glad they took that path, even though the decision was far from obvious at the time.
The SEC sued Ripple in 2020, alleging the company sold XRP as an unregistered security and naming both Garlinghouse and Larsen individually. He noted that he had met with regulators several times between 2017 and 2019 without legal representation and was never told XRP might be classified as a security, shaping his view that clear guidance was lacking.
Garlinghouse estimated the company spent about $150 million on legal fees over the four-year battle.
Ripple eventually secured a major win when Analisa Torres ruled that XRP itself is not a security. The case was settled in May last year after new SEC leadership adopted a more accommodating stance toward crypto.
