Ripple has made significant political contributions to Kamala Harris’ campaign. What could be the underlying strategy? Is this a political maneuver, or is Ripple positioning itself for a major shift with XRP?
Ripple’s Political Maneuver
Ripple, the prominent blockchain company behind XRP, has recently entered the political arena, particularly highlighted by notable remarks from its CEO, Brad Garlinghouse. At the D.C. Fintech Week event, Garlinghouse acknowledged Democratic presidential candidate Kamala Harris, commending her constructive stance on digital assets.
This newfound political engagement is curious, given Ripple’s historically neutral stance in U.S. elections and its challenging history with U.S. regulators. Garlinghouse’s comments come during a pivotal time for Ripple, which is contemplating the launch of an XRP ETF amid ongoing legal discussions with the U.S. SEC.
The alignment with Harris raises questions: What does this signify for Ripple’s future in the crypto space? We delve into Ripple’s political contributions, aspirations for an XRP ETF, and the unfolding narrative.
Ripple’s Shift in Support
Traditionally, Ripple has not maintained strong ties with the Democratic Party, especially after facing a $1.3 billion lawsuit from the SEC during President Biden’s administration. Yet, as we approach 2024, CEO Chris Larsen is stepping into the spotlight, making bold endorsements and financial contributions to Harris’ campaign.
Garlinghouse, while attempting to preserve Ripple’s neutral position, praised Harris for her technology-friendly vision and Silicon Valley connections. He has suggested that either a Harris or Trump victory would be beneficial for the crypto industry, contrasting his previous criticisms of the Biden administration’s approach to digital assets.
The situation intensified when Larsen donated $10 million in XRP to Harris’ campaign after an earlier gifting of $1 million—an unexpected move considering Trump’s overtures to crypto supporters.
Garlinghouse defended this decision, emphasizing Ripple’s commitment to supporting leaders who advocate for positive crypto policies, beyond political party affiliations.
Navigating a Complex Landscape
Ripple’s recent political actions have raised eyebrows within the industry. Earlier this year, Ripple’s Chief Legal Officer, Stuart Alderoty, notably contributed $300,000 in XRP to Trump’s campaign, capitalizing on Trump’s emerging pro-crypto stance. Industry belief suggests that a Trump presidency could lead to a more crypto-friendly regulatory environment.
Support from influential figures in the crypto sector, such as the Winklevoss twins and BitGo CEO Mike Belshe, indicates a growing alignment with Trump, making Ripple’s dual approach even more intriguing. Data highlights that crypto companies have significantly increased ad spending for Republican candidates over Democrats this election cycle.
This dual strategy suggests Ripple is keenly aware of the political landscape as it seeks to position itself ahead of the upcoming presidential election—evidence of the high stakes involved. With an estimated $190 million in political contributions from the crypto sector this cycle, the urgency is palpable for Ripple to maintain influence regardless of which candidate wins.
Ripple Pursues XRP ETF
Ripple’s recent donations to both Harris and Trump hint at a potential strategic play, aiming to navigate the complexities of the upcoming elections. With firms like Bitwise and Canary Capital already seeking approval for XRP ETFs, a successful launch could transform how investors access XRP without directly holding the cryptocurrency.
Garlinghouse has expressed confidence that an XRP ETF is inevitable due to rising demand from both retail and institutional investors. If approved, it would lend legitimacy to XRP as a financial asset and could ease concerns stemming from the SEC litigation.
An ETF approval would not only help Ripple fulfill market demand but also bolster investor confidence in XRP, potentially enhancing its value and liquidity. Given the SEC’s current stance, Ripple’s financial contributions may serve as a tactical hedge, preparing the company for favorable outcomes, regardless of the election result.
