Ripple continues its expansion to further widen its reach. Recently, the company announced its pending acquisition of Standard Custody & Trust Co. in New York to enhance its regulatory qualifications while expanding its operations in the US. However, this is still subject to regulatory approval.
If the deal comes to a finalization and gets a nod from the New York Department of Financial Services, it would allow Ripple to function beyond its current capacity as a payments network.
Although the nature of the agreement is still under wraps, the purchase is expected to let the developer of XRP aid institutional clients in their assets tokenization. Likewise, it would give Ripple’s customers an option to choose more seamless access to the digital asset custody solutions offered by Standard Custody instead of seeking third-party providers.
On the other hand, Standard Custody is projected to benefit a lot from the blockchain technology and expansive influence of its partner, Ripple.
Official Statement of Ripple
“We want to offer more and more of these infrastructure pieces to these financial institutions,” remarked Ripple President Monica Long in a CoinDesk interview. “We see this as giving us a lot of flexibility.”
Long hinted that the partnership involves a long-term project, but it’s still awaiting completion as Ripple has yet to finalize the submission of its money licensing requirements in the US.
Despite the company’s ongoing legal clash with the US Securities and Exchange Commission (SEC), Long expressed optimism in the new venture.
“But the US is a major market, and we believe it’s possible for the US to emerge as a leader in driving innovation,” she stated.
Ripple Vs the US SEC
Ripple has been on a long-term court battle against the SEC since 2020 due to the former’s sale of XRP to ramp up its business. The SEC claimed that the crypto firm breached US securities laws for its failure to get regulatory approval. The lawsuit also dragged co-founder and former CEO Chris Larsen and current CEO Brad Garlinghouse into the fray.
After a back-and-forth maneuvering on both sides, Ripple gained a partial but major victory as the presiding judge, Analisa Torres, declared that XRP sales via crypto exchanges didn’t constitute an offer to sell securities. However, it came with a caveat that the same cannot be said for the sale of XRP to institutional investors.
In line with the recent developments of the case, the SEC just successfully motioned for the submission of Ripple’s contracts and information regarding its institutional sale of XRP during 2022 and 2023. It remains to be seen whether or not Ripple will comply.
Based on the latest progress of the conflict, Ripple is still a long way from a verdict. However, some legal experts agree that it might eventually lead to a settlement, especially if a new president wins the coming election and the new administration will have a more favorable treatment toward the crypto industry.