- Ripple will continue to be a stakeholder in Fortress Trust’s parent firm.
- Cancellation of the deal, according to Purcell, is not related to the security issue.
Ripple is backing out of its planned acquisition of Fortress Trust only 20 days after announcing the purchase in order to ostensibly increase its number of licenses in the U.S.
Yesterday, Ripple CEO Brad Garlinghouse said on Twitter about the decision to abandon the acquisition. However Ripple will continue to be a stakeholder in Fortress Trust’s parent firm Fortress Blockchain Technologies. Ripple has already announced their intent to invest in other Fortress group firms, such as FortressPay.
Not a Big Deal
A few days after the acquisition announcement, Fortress Trust admitted that a security problem involving a third-party analytics company had prompted them to move quickly on the deal. Fortress CEO Scott Purcell told Fortune that the hack cost the corporation between $12 and $15 million.
Bitcoin predominated, with some USDC and USDT also present. Moreover, Ripple has been an investor in the firm since its 2022 seed round. Cancellation of the deal, according to Purcell, “is not a big deal.” He claims the security issue had nothing to do with the shift in plan. Other firms with links to Fortress may be affected from the deal’s collapse while Ripple continues its high-profile legal fight with the U.S SEC.
For instance, Swan Bitcoin is forming a partnership with BitGo to establish a Bitcoin-only trust firm in the United States. This endeavor is subject to the necessary approvals from relevant authorities. Swan relies on Fortress Trust as a custody provider. Swan will have no further involvement with Ripple’s operations in the nation after the agreement fell through.
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