Garlinghouse: Ripple is not profitable without the sale of XRP
Garlinghouse: Ripple is not profitable without the sale of XRP
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Garlinghouse: Ripple is not profitable without the sale of XRP

By Marco Cavicchioli - 2 Mar 2020

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Ripple’s CEO, Brad Garlinghouse, has stated bluntly that the company would not be profitable without the sale of XRP

This was revealed in a report published by the Financial Times, which cites words uttered by Garlinghouse himself: 

“We would not be profitable or cash flow positive [without selling XRP]”.

In other words, the sale of XRP tokens on the market at this stage produces a significant part of Ripple’s profitability, suggesting quite explicitly that it will continue over time. 

“Well XRP is one source. I don’t know how to answer that because if you took away our software revenues, that would make us less profitable. If you took away all our XRP, that makes us less profitable. So I don’t think about it as one thing”. 

Therefore, the company needs someone to buy the XRP it sells on the market to avoid making a loss, at least at this stage. 

Despite this, total sales of XRP by Ripple fell 80% in the fourth quarter of 2019, to the point where the price rose from $0.18 in mid-December to $0.34 in mid-February, before falling to around $0.23. 

However, during 2019 it fell from $0.3 at the beginning of the year to $0.19 at the end of the year, peaking at $0.46 in June. 

These findings reopen the case linked precisely to fluctuations in the value of XRP, particularly in relation to tokens being sold on the market by the company. 

In short, those who buy XRP on the market are in fact financing the company Ripple, and this could affect the question of whether XRP should be considered as a security

Certainly, the purchase of XRP on the market does not include any guarantee or promise of profit, and the fact that the company operates directly in these markets out of necessity certainly complicates things. 

At this point, the accusations made against Ripple that it was one of the main culprits for the fall in the price of XRP are becoming plausible again, and it is conceivable that these statements by Garlinghouse could end up affecting several XRP investors. 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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