Ripple IPO: why this $40B giant still snubs Wall Street

Ripple’s $40B empire beat the SEC yet still ghosts Wall Street IPO Ripple has had one of the most surreal rides in the last few years. Even though it has spent years at odds with the U.S. Securities and Exchange Commission, Ripple won the battle, and a federal judge ruled that XRP, because it is […]

Ripple’s $40B empire beat the SEC yet still ghosts Wall Street IPO

Ripple has had one of the most surreal rides in the last few years. Even though it has spent years at odds with the U.S. Securities and Exchange Commission, Ripple won the battle, and a federal judge ruled that XRP, because it is traded on public exchanges, is not inherently a security; Ripple was in a unique legal position. That victory lifted an enormous regulatory cloud hanging over the company and its token and it provided Ripple with momentum that many figured would push it toward becoming a publicly traded juggernaut. The company has secured hundreds of millions in private capital and is currently valued near $40 billion a figure that usually indicates an IPO is in process.

Instead, Ripple surprised and excised investors by claiming that it has no plan for going public. The company is still quietly choosing to remain private, and while Wall Street expressed interest, it’s not saying so. This decision makes sense because most businesses with Ripple’s price and name recognition would be running to a stock listing.

This is one expectation of investment: Liquidity, exposure to markets and the added attention that comes with being able to ring the bell on the New York Stock Exchange. Ripple’s leadership, however, have underscored that the company does not need to enter any public markets for its growth to happen. They maintain, however, that, given adequate private capital and stable business evolution, there simply is no viable incentive to carry the kinds of burdens that come with being a public company. Ripple has that level of capital; enough revenue stability; enough partnerships globally so that it can function comfortably without going to Wall Street for cash. Ripple’s calculus another big part of its decision-making is also the harsh reality of how public markets treat crypto-related companies.

When Coinbase went public in 2021, the moment had enormous hype, with heavy market activity and a price plunge during peak periods. Robinhood faced the same turbulence after its IPO even though a big name in the retail trading boom. These cases demonstrate, there is nothing to show for the idea that in any case that even companies with huge user bases and brand value, once they go public are immune to that kind of stability when they enter the public space, then to maintain a stable valuation.

Ripple’s business is even less insulated from the crypto market than these players’, and public investors would continuously examine Ripple’s financial stability according to whether XRP price swings fluctuate, its trading volumes rise and fall and the overall market mood. Ripple also has quite a bit of XRP in escrow, and even that would attract huge amount of media attention if the company was announced publicly. Investors would call for comprehensive reports on how much XRP Ripple releases, how frequently it sells and how those sales affect the market. Ripple’s token holders are already watching Ripple closely and it risks an extra layer of pressure from shareholders pressuring the company to be public, who could want it to monetize its XRP holdings more aggressively. That could lead to a schism between equity investors and token holders, who are often not on equal footing on what is most important. Not allowing the rest of Ripple’s XRP holdings to remain private protects Ripple from becoming a headline item or even a quarterly buzzword. Another cause for fear is the U.S. regulatory environment.