Ripple Cancels Plan to Buy Fortress Trust

"While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future," said Ripple CEO Brad Garlinghouse.

AccessTimeIconSep 28, 2023 at 7:10 p.m. UTC
Updated Sep 28, 2023 at 7:38 p.m. UTC

Ripple said it won't go forward with its outright acquisition of Nevada-based chartered trust company Fortress Trust.

"A few weeks ago, we signed a letter of intent to acquire Fortress Trust – we’ve since made the decision not to move forward with an outright acquisition, though Ripple will remain an investor," Ripple's CEO Brad Garlinghouse said on social media platform X (formerly Twitter).

Ripple said on Sept. 8 that it intended to buy Fortress for an undisclosed amount. At the time, a person with knowledge of the matter said the price tag was less than the $250 million Ripple paid for custody firm Metaco in May.

The day before, Fortress Trust disclosed a theft of customers’ cryptocurrency, later revealed to total close to $15 million. It pinned the blame on an unnamed third-party vendor that had fallen victim a phishing attack. CoinDesk later identified the vendor as Retool, a San Francisco-based company with Fortune 500 customers, which had built a portal for a handful of Fortress clients to access their funds. Ripple said the acquisition talks predated the theft, but it accelerated them.

Fortress Trust, which provides financial and regulatory infrastructure for blockchain companies, was formed by Scott Purcell, who has a long history in the industry. He was CEO of crypto custodian Prime Trust until 2020. Years after he left Prime Trust, the company was ordered into receivership after fellow custodian BitGo terminated its proposed acquisition of the firm.

"The Fortress team is incredibly talented, and has built products solving real customer problems. While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future," Garlinghouse added.

UPDATE (Sept 28, 19:36 UTC): Adds background about $15 million theft from Fortress.


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Aoyon Ashraf

Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets