Ripple IPO Preparations Underway? SBI Cites XRP as Innovation Driver

• SBI Holdings CEO Yoshitaka Kitao envisions Ripple’s technology and XRP as a global standard for digital transactions.
• Ripple’s lawsuit with the SEC, ongoing since December 2020, has been a major roadblock, with mixed rulings complicating the regulatory landscape.

Ripple’s potential plan to launch an initial public offering (IPO) has continued to simmer following remarks made by SBI Holdings CEO Yoshitaka Kitao. Recently, Kitao made his appeal on the social media network X to prepare for an IPO once Ripple settles its legal case with the U.S. Securities and Exchange Commission (SEC.

His remarks followed a post commemorating XRP’s progress to become the sixth biggest cryptocurrency in terms of market capitalization.

Yoshitaka Kitao’s Take on Ripple IPO

Kitao’s interest in pushing Ripple into an initial public offering is, indeed, part of his long-standing appreciation for the blockchain firm. In 2017, SBI Holdings, one of Japan’s biggest financial groups, entered into a strategic alliance with Ripple in pursuit of crossing innovations in payments across borders.

A key figure in this partnership, Kitao was appointed to Ripple’s Board of Directors in 2019 and has since led the enhanced partnership. His vision for XRP as a global digital currency standard, citing low transaction costs and scalability, has formed the strategic push of SBI in integrating Ripple’s technology into its operation activities in Japan and the Asia-Pacific region.

Meanwhile, Ripple’s management has been opposed to the public listing until now. Nonetheless, CEO Brad Garlinghouse mentioned the company’s good financial health as a notable reason for staying away from raising funds through a public market. He also pointed out the uncertain regulatory environment in the U.S. and attributed most of that uncertainty to the current legal battles between Ripple and the SEC.

A Look At Major Regulatory Hurdles

Ripple is battling through its lawsuit with the SEC that dates back to December 2020. The regulator had accused the company of making unregistered securities offerings via the sales of XRP. During July 2023, a tremendous milestone was witnessed in the case as a US federal court ruled that XRP cannot be considered inherently security, a judgment welcomed by the crypto industry, reported CNF. 

However, the court also found in this case that Ripple had indeed run afoul of securities laws in certain institutional sales of XRP. Hence, it imposed a penalty of $125 million in an August ruling. The SEC then appealed part of that decision, prolonging regulatory uncertainty.

Nonetheless, Garlinghouse expressed hope that the U.S. would be able to see a more favorable regulatory environment, reported CNF. Recently, he welcomed comments by previous U.S. President Donald Trump that he would replace SEC Chair Gary Gensler if re-elected. According to Garlinghouse, such signals are a positive indication for the industry, welcoming it as a new chapter for crypto.

More interest is apparently building in the future plans at SBI following the call for Ripple’s readiness for an IPO. However, the timeline for any potential public offering is likely to depend on the resolution of the legal case related to Ripple and the SEC.