Ripple, a blockchain technology company, has distanced itself from Linqto amid SEC and DOJ investigations. CEO Brad Garlinghouse emphasized that Linqto did not buy shares directly from Ripple.
CEO Ripple's Statement
Brad Garlinghouse noted that there is no direct relationship between Ripple and Linqto regarding ownership and sale of Ripple shares. Despite Linqto holding 4.7 million Ripple shares, they were acquired on the secondary market, not purchased directly from the company. This highlights potential transparency issues in secondary trading markets.
> "Understandably, there have been many questions from those who believed they were buying Ripple shares from Linqto, and what happens next... What we know from our records is Linqto owns 4.7 million shares of Ripple, solely purchased on the secondary market from other Ripple shareholders (never directly from Ripple)." - Brad Garlinghouse, CEO, Ripple
Investigation into Linqto
Former CEO of Linqto, William Sarris, is under investigation for inflating share values and selling shares without consents. The new CEO, Dan Siciliano, acknowledged past compliance issues, reflecting a shift in the company's leadership and practices. These investigations spotlight regulatory concerns within the private equity sector.
Impact on Ripple and Digital Asset Market
The ongoing investigations by the SEC and DOJ target Linqto's practices, potentially impacting retail investors who accessed Ripple shares through this platform. Ripple's native token, XRP, remains mostly unaffected, although reputational risks persist. The scrutiny reveals broader concerns about secondary market disclosures and protection for retail investors. Ripple maintains its operational independence from Linqto, with no financial ties to the firm.
The incident does not appear to directly affect other digital assets or blockchain technology. Ripple assures stakeholders that there are no changes to XRP's market status or technological framework. Regulatory actions may shape future secondary trading platforms by requiring enhanced transparency and accountability, highlighting the critical need for reform in trading practices.
