Ripple Takes a Step Back from Fortress Trust Deal
Blockchain firm Ripple has canceled its plans of an outright acquisition of Fortress Trust, a development that marks a significant U-turn from the former’s previous intention to purchase the company roughly three weeks earlier.
CEO’s Announcement
Ripple CEO Brad Garlinghouse took to X to announce the news, stating that the outcome was different from the original plan to buy Fortress Trust. While Garlinghouse did not state the reason for the termination, the Ripple chief said his company “will remain an investor” in Fortress Blockchain Technologies, the parent company of Fortress Trust.
Garlinghouse’s Statement
In his tweet, Garlinghouse mentioned:
“The Fortress team is incredibly talented and has built products solving real customer problems. While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future.”
History of the Relationship
The relationship between Ripple and Fortress dates back to 2022, after the former participated in the latter’s seed funding, becoming a minority investor in the company. On Sept. 8 Ripple had announced its intent to buy Fortress Trust shortly after acquiring crypto custody provider Metaco for $250 million.
Concerns Regarding Security
The proposed Fortress Trust acquisition would have expanded Ripple’s collection of regulatory licenses, given that Fortress has a Nevada Trust license. Notably, a day before the acquisition plans, on Sept. 7, Fortress had announced a security breach affecting one of its third-party vendors, which impacted four clients. Ripple later intervened to compensate the four affected customers as part of the acquisition deal, although specific details about the loss from the incident and the amount compensated remain undisclosed.
