Ripple’s Big Bets on Kamala Harris: What’s the Strategy Behind It?[embed]https://www.youtube.com/watch?v=cCwk-hHhDws[/embed]

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<p class="is-style-lead">Ripple has invested millions in support of Kamala Harris. What’s the underlying motive? Is this a political play, or is Ripple preparing for something larger with XRP?</p>

<h2 class="wp-block-heading" id="ripples-split-personality-hits">Ripple’s dual nature revealed</h2>

<p>Ripple, the leading blockchain company behind XRP, has frequently been in the news for various reasons. Recently, it seems Ripple is intensifying its political presence, particularly with some notable remarks from CEO Brad Garlinghouse.</p>

<p>At the D.C. Fintech Week event, Garlinghouse made a rare acknowledgment of Democratic presidential candidate Kamala Harris, commending her perspective on digital assets and even labeling her views on crypto as “most constructive.”</p>

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<p>This is certainly surprising, especially considering Ripple’s traditionally neutral stance in U.S. elections and its turbulent interactions with U.S. regulators.</p>

<p>Garlinghouse’s remarks come at a pivotal moment, as Ripple explores the potential of launching an XRP ETF while still managing the consequences of its ongoing legal disputes with the U.S. SEC during a Democratic administration.</p>

<p>So, what’s behind the shift towards endorsing Harris, and what could it indicate for Ripple’s future? Let’s dive into Ripple’s political contributions, aspirations for an XRP ETF, and the surrounding drama.</p>

<h2 class="wp-block-heading" id="ripples-political-pivot">Ripple’s political shift</h2>

<p>Historically, Ripple hasn’t been on friendly terms with the Democratic Party, largely due to the $1.3 billion lawsuit filed against it by the SEC under President Biden's watch in 2020.</p>

<p>Yet, in 2024, we observe Ripple CEO and co-founder Chris Larsen making significant endorsements and donations in support of Harris’ presidential campaign.</p>

<p>While maintaining Ripple’s neutral stance on elections, Garlinghouse characterized Harris as “pro-technology” and commended her ties to Silicon Valley.</p>

<p>He even suggested that either a Harris or Trump victory would be beneficial for the cryptocurrency sector, a stark contrast to his previous criticisms of the Biden administration's policies.</p>

<p>The real turning point came when Chris Larsen donated an astounding $10 million in XRP to Harris’ campaign, following an earlier $1 million donation. This came after Trump actively sought support from the crypto community, making Larsen’s actions even more surprising.</p>

<p>Nic Carter, a prominent figure in crypto investment, took to Twitter to express his bewilderment, labeling the donation “completely baffling.” Many in the sector have viewed Trump as more aligned with crypto interests, given his vocal support for digital assets.</p>

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<p>Despite this, Garlinghouse defended his co-founder’s actions, affirming that Ripple promotes a culture where employees support whichever candidates they feel will best lead the nation, emphasizing the focus on pro-crypto policies rather than party allegiance.</p>

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<blockquote class="twitter-tweet" data-width="550" data-dnt="true"><p lang="en" dir="ltr">I respect Chris’ (and everyone’s!) right to support whomever they think is best to lead the U.S. </p><p>We need to change course immediately from this administration’s misguided war on crypto. </p><p>Ripple will continue to engage with both Democrats and Republicans as the election approaches…</p>— Brad Garlinghouse (@bgarlinghouse) <a href="https://twitter.com/bgarlinghouse/status/1848407530458042687?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">October 21, 2024</a></blockquote>
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<p>He pointed out the significance of the upcoming 2024 election for the future of the crypto sector, asserting that improvements in policy could come from either Harris or Trump in contrast to what he described as the Biden administration's “failed approach” to digital assets.</p>

<p>This has intensified speculation surrounding Ripple’s intentions, especially given the tense relationship with the SEC, which has been fraught with difficulties.</p>

<p>Ripple’s interactions with the Democratic Party, particularly with the SEC, have been anything but smooth. The lawsuit—alleging that XRP sales were unregistered securities—filed in 2020 has loomed over Ripple for several years. Although Ripple saw some success in July 2023 when a judge determined that XRP transactions to retail investors didn’t qualify as securities, the SEC remained firm.</p>

<p>In the most recent developments from August 2024, the SEC sought a hefty $2 billion fine, ultimately receiving a reduced $125 million penalty. While Ripple celebrated this as a win, the ongoing appeal by the SEC continues to sow uncertainty.</p>

<h2 class="wp-block-heading" id="a-strategy-of-survival">An approach for survival?</h2>

<p>Ripple’s recent political activities have certainly defied the norm. Just months prior, in June 2024, Ripple's Chief Legal Officer, Stuart Alderoty, garnered attention with a sizeable $300,000 XRP donation to Trump’s campaign.</p>

<p>Alderoty’s donation coincided with Trump’s repositioning towards a pro-crypto ideology, which likely influenced the Ripple CLO’s choice. Many speculated that a Trump presidency could lead to the ousting of Gensler as SEC chair, potentially ushering in a more crypto-friendly regulatory environment.</p>

<p>Between April and June 2024, Trump’s fundraising campaigns <a href="https://www.cnbc.com/2024/07/25/trump-raises-more-than-4-million-in-bitcoin-other-cryptocurrencies.html" target="_blank" rel="nofollow">gathered</a> over $118 million, with $4 million sourced from cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), and XRP.</p>

<p>Notable backers like Tyler and Cameron Winklevoss, along with BitGo CEO Mike Belshe, have also shown their support for Trump, reinforcing the crypto sector's alignment with the former president.</p>

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<blockquote class="twitter-tweet" data-width="550" data-dnt="true"><p lang="en" dir="ltr">I just donated $1 million in bitcoin (15.47 BTC) to <a href="https://twitter.com/realDonaldTrump?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">@realDonaldTrump</a> and will be casting my vote for him in November. Here’s why:</p><p>Over the past few years, the Biden Administration has openly declared war on crypto, weaponizing multiple government agencies to bully, threaten, and… <a rel="nofollow" href="https://t.co/qOQSpmanBR" target="_blank">pic.twitter.com/qOQSpmanBR</a></p>— Tyler Winklevoss (@tyler) <a href="https://twitter.com/tyler/status/1803872859938549920?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">June 20, 2024</a></blockquote>
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<p>Despite Ripple’s seeming divided allegiances, the wider crypto industry has heavily favored Trump. Recent statistics from AdImpact <a href="https://qz.com/crypto-companies-spends-more-on-ads-for-republicans-tha-1851678302" target="_blank" rel="nofollow">indicate</a> that crypto companies have allocated 62% more on advertisements for Republican candidates compared to Democrats this year.</p>

<p>Fairshake, a leading PAC, has invested $54.6 million into election ads backing GOP candidates versus $33.7 million for Democrats.</p>

<p>This financial focus is predominantly on critical House races in states like New York, Nevada, and California. For instance, Republicans David Valadao and Michael Garcia in Southern California, both facing challenging races, received $1.3 million and $1 million, respectively, from crypto-supported PACs.</p>

<p>Ripple’s dual approach highlights the uncertainty surrounding the upcoming 2024 U.S. presidential election and its implications for the crypto industry.</p>

<p>With political donations from crypto entities <a href="https://www.cnbc.com/2024/10/21/ripple-founder-has-given-more-than-11point8-million-to-harris-campaign.html" target="_blank" rel="nofollow">tallying</a> an impressive $190 million for this election cycle, the stakes have never been higher. Whether it's Trump or Harris taking the Oval Office in 2025, Ripple appears committed to securing a seat at the table. But what’s the reasoning?</p>

<h2 class="wp-block-heading" id="ripple-eyes-xrp-etf">Ripple sets sights on XRP ETF</h2>

<p>On one front, Larsen has been vocal in supporting Harris, while on another, Alderoty made a contribution to Trump’s campaign in June 2024. However, Ripple’s recent political contributions—both to Harris and Trump—may represent a calculated strategy.</p>

<p>With Bitwise and Canary Capital already pursuing XRP ETFs, if approved, these would provide investors with access to XRP through a stock exchange without needing to hold the cryptocurrency itself.</p>

<p>Garlinghouse recently stated to Bloomberg that an XRP ETF is “inevitable,” highlighting the increasing demand from both retail and institutional investors for this asset class. The approval of an XRP ETF could dramatically change the landscape for Ripple and its investors.</p>

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<p>For instance, spot Bitcoin ETFs have surged to manage over $50 billion in assets, underscoring the interest from institutional investors who prefer accessing cryptocurrency without the burdens of direct ownership.</p>

<p>Conversely, despite an eagerly anticipated launch in July 2024, Ethereum ETFs have only accumulated around $7 billion in assets—much less than Bitcoin.</p>

<p>From Ripple’s viewpoint, receiving approval for an XRP ETF would signify a monumental victory. Not only would it affirm XRP’s status as a legitimate financial asset, but it would also assist in addressing lingering concerns raised by the SEC lawsuit.</p>

<p>Therefore, an ETF would allow Ripple to cater to investor needs in a regulated and mainstream fashion, boosting confidence in XRP while potentially enhancing its value and liquidity.</p>

<p>In light of the SEC’s persistent opposition, Ripple’s financial support for both Harris and Trump could be a tactical maneuver, allowing the company to position itself favorably with either administration and finally gain approval for the long-awaited XRP ETFs—regardless of who assumes the presidency in 2024.</p>

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