Tetragon, a major shareholder of Ripple (XRP), demanded repayment of $175 million. The court rejected his claim. For the time being.
Finally a happy outcome for Ripple under the influence of SEC lawsuits in the United States and the exclusion of many crypto exchanges. The issuer of the XRP is, in fact, also on trial with one of its shareholders.
In 2019, Tetragon participated in Ripple’s $200 million capital raising. And in early 2021, the investor filed lawsuits. The objective: to obtain the repurchase of its shares. Tetragon invoked the legal uncertainty threatening XRP.
The bill was likely to be heavy for Ripple in the current environment. Ripple’s shareholder was demanding $175 million. However, Ripple will not get that money back at this time. The courts have ruled otherwise.
A Delaware court rejected the asset manager’s claim. Ripple is relieved by this decision. “XRP is no more a security than it was before the SEC filed the lawsuit,” the blockchain firm reacted in a press release.
Ripple may only be on probation, however. “The action for enforcement, on the other hand, raises this question. The issue is not yet resolved, so a conclusion has not yet been reached,” the company acknowledges.
To demand repayment of its $175 million investment, Tetragon will have to be patient. And therefore wait for a court decision on the complaint of the stock exchange regulator.
Ripple nevertheless denounces the “opportunistic” attack of its shareholder. According to Ripple, Tetragon’s lawsuit is aimed solely at “taking advantage of the SEC’s allegations. “In this regard, Ripple is confident.
“What has always been clear (and is even clearer today) is that the SEC still has to try to prove its case in court, which we believe it will not succeed in doing,” the firm says.
To exit Ripple’s capital and receive compensation for it, Tetragon must therefore be patient. The firm asked the court to prevent Ripple from using “any money or other liquid assets” until this dispute is resolved.
Is such an action justified? No. The fundraising agreement provides for compensation if XRP is found to be a security. This is precisely what the SEC is charging Ripple with.