Days after announcing it was ending its partnership with Moneygram, fintech firm Ripple Labs is looking to sell its stake in the publicly traded company. In a statement to the U.S. Securities and Exchange Commission (SEC), Ripple said it has reached an agreement with Jefferies under which the latter will conduct an orderly sale of the former’s stake in Moneygram.
Partnership Impulse and money May be revised
As set out in the filing, the agreement provides for the sale of up to 8,195,123 shares on behalf of Ripple by Jefferies, a US-based diversified financial services firm. This share withdrawal plan, which was launched on 11… March, but must start before the 30th. September 2021. At that time, the maximum amount must be sold or another event customary for the issuer occurs.
Despite these moves to end the relationship, Ripple hinted in a statement that the partnership could be revisited in the future. Fintech said:
We are both determined to revisit our relationship in the future. We continue to believe that digital assets and blockchain technology can change the status quo in global payments to benefit billions of consumers around the world.
Effect of filing with the Securities and Exchange Commission
After the SEC announced it was suing Ripple Labs for alleged violations of US securities laws, Moneygram’s business relationship with the fintech became more complicated, prompting Moneygram to take action. For example, Moneygram said there were logistical issues with using the platform, as well as legal and reputational risks following the announcement of a lawsuit.
In addition, the publicly traded money transfer organization reported revenue losses due to the end of its relationship with Ripple. On the other hand, Ripple is facing the fact that its XRP token has been removed from some cryptocurrency exchanges due to an SEC complaint. The fintech company also faces further investigation by the SEC, as well as new lawsuits.
Despite the growing pains, Ripple insists it has not violated any security laws. Some early signs of the legal battle between the SEC and Ripple already seem to indicate an uphill battle for the regulator.
What does the end of the relationship between Ripple and Moneygram mean for blockchain technology? Tell us what you think in the comments below.
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