Why is Ripple betting big on Kamala Harris and shocking everyone?

As a seasoned observer of the dynamic world of finance and technology, I find myself intrigued by Ripple’s strategic maneuvers in the 2024 U.S. presidential election. With over three decades of experience in the financial industry under my belt, I can confidently say that Ripple is playing a high-stakes game of political chess.

As a crypto investor, I’ve been wondering lately: With Ripple reportedly investing millions into Kamala Harris’ campaign, one can’t help but wonder what their true intentions are. Is this a political move, or could it be a strategic step towards a larger plan involving XRP? It’s intriguing to ponder the possibilities.

Table of Contents

Ripple’s split personality hits

Recently, Ripple, a well-known player in the blockchain world and creator of XRP, has been drawing attention for various reasons. More recently, however, it appears that Ripple is making strategic moves in the political arena, particularly with bold comments coming from its CEO, Brad Garlinghouse.

At the D.C. Fintech Week gathering, Garlinghouse offered a seldom endorsement towards Democratic presidential nominee Kamala Harris, commending her viewpoint on digital assets. In fact, he characterized her position on cryptocurrency as “the most beneficial.

Given Ripple’s past stance of staying impartial during U.S. elections and its tumultuous history with American regulators, this recent development is quite surprising.

However, Garlinghouse’s remarks are particularly noteworthy given the current context—a period in which Ripple is considering the prospect of an XRP Exchange-Traded Fund and navigating the repercussions of its ongoing legal dispute with the U.S. Securities and Exchange Commission under a Democratic government.

What’s causing the move to Harris, and what might it imply for Ripple’s upcoming events? Let’s examine Ripple’s political contributions, their aspirations for an XRP Exchange-Traded Fund (ETF), and the turbulence that surrounds these matters.

Ripple’s political pivot

Historically, Ripple hasn’t always seen eye-to-eye with the Democratic Party, particularly since it encountered a $1.3 billion lawsuit from the SEC during President Biden’s term in 2020.

Indeed, it’s the year 2024, and we find ourselves observing Chris Larsen, the CEO and co-founder of Ripple, making confident declarations and charitable contributions in favor of Democratic presidential nominee Kamala Harris.

In a continued impartial approach towards the election, Garlinghouse characterized Kamala Harris as technology-friendly and commended her ties with Silicon Valley.

He even suggested that either a Harris or Trump win would benefit the crypto industry, a notable contrast to his harsh criticism of the current Biden-led administration’s approach.

However, the true excitement ensued when Chris Larsen made an unexpected contribution of $10 million in XRP to Harris’ campaign, which was preceded by a previous donation of $1 million. This act took place following Trump’s efforts to win over cryptocurrency supporters, making Larsen’s decision all the more surprising.

nic carter, a prominent figure in the cryptocurrency investment world, voiced his puzzlement on Twitter, describing the donation as utterly perplexing. However, it’s worth noting that many within the crypto industry view trump as more of an advocate for digital currencies due to his public endorsements of such assets.

However, Garlinghouse justified his co-founder’s choice, explaining that Ripple encourages its team members to back whoever they think is beneficial for the nation. He emphasized that this stance is less about political party allegiance and more about promoting policies that are favorable towards cryptocurrencies.

In simpler terms, Garlinghouse stated that the 2024 election is significant for the crypto sector’s future. He thinks both Harris and Trump could enhance the perceived shortcomings of the Biden administration’s policies on digital currencies, which he described as unsuccessful.

As a researcher delving into the intricacies of Ripple’s situation, I can’t help but find myself further questioning their intentions, given the ongoing strife in their dealings with the SEC.

The interactions between Ripple and the Democratic-aligned SEC have not run smoothly. Back in 2020, the SEC filed a substantial lawsuit against Ripple, alleging that the company was illegally selling unregistered securities through XRP.

For several years, Ripple has been under a lingering shadow due to this lawsuit initiated during President Biden’s term. However, in July 2023, Ripple managed to secure a partial win when a judge decided that sales of XRP to individual investors were not considered securities. Despite this, the SEC remained unfaltering in their stance.

In the latest verdict in August 2024, the regulator sought a massive $2 billion fine, only to be awarded a much smaller $125 million penalty. Ripple hailed this as a victory, but the SEC’s ongoing appeal continues to create uncertainty.

A strategy of survival?

In a rather unexpected turn of events, the recent political maneuvers by Ripple have been far from typical. Just a few months ago, in June 2024, the Chief Legal Officer of Ripple, Stuart Alderoty, made waves with a substantial $300,000 donation of XRP to Donald Trump’s presidential campaign.

Alderoty’s donation occurred during a period when Trump was moving towards a pro-cryptocurrency position, a shift that might have influenced the Ripple CLO’s decision. Given that some thought if Trump were to return as president, he could appoint a more cryptocurrency-friendly SEC chair instead of Gensler, such an appointment could positively impact the cryptocurrency sector.

During the span of April to June in the year 2024, Donald Trump’s fundraising activities managed to accumulate more than $118 million. Around $4 million of this sum was donated via cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP).

Notable figures within the cryptocurrency community, including Tyler and Cameron Winklevoss, along with Mike Belshe, the CEO of BitGo, have likewise shown support for Donald Trump. This additional backing from the crypto sector underscores a growing affiliation between the industry and the former U.S. president.

Despite Ripple’s apparent split allegiances, the broader crypto industry has been heavily backing Trump. Recent data from AdImpact reveals that crypto companies have spent 62% more on ads for Republicans than Democrats this year.

In simpler terms, it means that Fairshake, one of the biggest Political Action Committees (PACs), has invested approximately $54.6 million in election advertisements backing Republican candidates, while spending about $33.7 million on ads supporting Democratic candidates.

A significant portion of these expenses is directed towards crucial House elections in states such as New York, Nevada, and California. For example, Republican candidates David Valadao and Michael Garcia, both running close campaigns in Southern California, have received financial support totaling $1.3 million and $1 million respectively, from Political Action Committees (PACs) linked to the crypto sector.

Ripple’s two-pronged approach mirrors the ambiguity about the outcome of the 2024 U.S. presidential election and how it might influence the cryptocurrency sector.

In the current election cycle, political donations from cryptocurrency groups are nearing $190 million, making the situation more significant than ever. Regardless of whether Trump or Harris occupy the White House in 2025, Ripple is keen to secure a place at future discussions. However, one may wonder, what’s their motivation?

Ripple eyes XRP ETF

In one aspect, Larsen has openly expressed his backing for Harris. Conversely, Alderoty contributed financially to Trump’s campaign in June 2024. Yet, Ripple’s recent donations, which went to both Harris and Trump, could hint at a strategic move behind the scenes.

Already, both Bitwise and Canary Capital have applied for Exchange-Traded Funds (ETFs) based on XRP. If these applications are approved, it will enable investors to acquire exposure to XRP via a traditional stock market without needing to directly possess the digital currency.

In a conversation with Bloomberg, Garlinghouse expressed that an XRP Exchange-Traded Fund (ETF) becoming a reality is almost certain, citing increasing interest from both individual and institutional investors to invest in this asset category. If approved, such an ETF could significantly alter the landscape for Ripple and its associates.

To illustrate, Exchange-Traded Funds (ETFs) focused on Bitcoin have amassed more than $50 billion in assets, demonstrating a strong appetite among institutional investors for indirect investment in cryptocurrencies, as they seek to avoid the complications associated with direct ownership.

Contrarily, Ethereum Exchange-Traded Funds (ETFs), highly anticipated for their launch in July 2024, have accumulated approximately $7 billion in assets under management (AUM). However, this amount is significantly less than that of Bitcoin.

Looking at things from Ripple’s standpoint, the acceptance of an XRP Exchange-Traded Fund (ETF) would be a significant triumph. This approval wouldn’t just solidify XRP as a bona fide financial instrument, but it would also help assuage the uncertainties brought about by the ongoing SEC lawsuit.

Consequently, an Exchange-Traded Fund (ETF) could provide a legitimate, widely accepted avenue for investors to acquire Ripple, thereby increasing trust in XRP. This increased faith might lead to a surge in the value and market fluidity of XRP.

In simpler terms, Ripple’s donations to both Harris and Trump could be seen as a strategic move, aiming to influence either candidate positively towards Ripple and potentially speed up approval for their anticipated XRP Exchange-Traded Funds (ETFs), regardless of who wins the 2024 election.

Read More

Sorry. No data so far.

2024-10-24 21:31