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Ripple Abandons Acquisition of Fortress Trust: What's Next for XRP?

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Oct 3, 2023 at 11:39 am

"While the situation has taken an unexpected turn, we remain committed to supporting them and look forward to potential future collaborations," stated Ripple CEO Brad Garlinghouse.

Ripple has decided to halt its initial plan of acquiring Fortress Trust, a chartered trust company based in Nevada.

Just a few weeks ago, Ripple had formally expressed its intent to acquire Fortress Trust. However, a shift in decision has led to the abandonment of the outright acquisition. Brad Garlinghouse, the CEO of Ripple, announced this development on the social media platform X (formerly Twitter).

On September 8, Ripple had initially announced its intention to purchase Fortress for an undisclosed sum. According to insiders, the acquisition price was lower than the $250 million Ripple paid in May to acquire the custody firm Metaco.

The day before this announcement, Fortress Trust reported a cryptocurrency theft involving its customers. The total loss was later revealed to be nearly $15 million. The blame was placed on an unnamed third-party vendor that fell victim to a phishing attack. Subsequently, Bitsday identified the vendor as Retool, a San Francisco-based company catering to Fortune 500 clients. Retool had created a portal for a select group of Fortress clients to access their funds. Ripple clarified that the discussions regarding the acquisition were initiated prior to the occurrence of the theft, though it did accelerate the process.

Fortress Trust specializes in offering financial and regulatory infrastructure services to blockchain companies. It was established by Scott Purcell, a seasoned figure in the industry. Purcell served as the CEO of the crypto custodian Prime Trust until 2020. In later years, after his departure from Prime Trust, the company was placed under receivership following the termination of its proposed acquisition by fellow custodian BitGo.

Garlinghouse commended the highly skilled Fortress team for their contributions in addressing genuine customer needs. Despite the deviation from the original plan, Ripple remains committed to extending support and looks forward to potential future collaborations.

Read more: KeyRock's Market Maker Achieves Swiss Anti-Money Laundering Approval

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