Ripple, a cryptocurrency firm, declared on Friday that it had purchased Fortress Trust, a startup that focuses on crypto infrastructure, for an undisclosed amount. The transaction will provide Ripple with a license from Nevada, allowing them to move beyond their blockchain-based payments core capability. Back in May, Ripple arranged to purchase Metaco, a Swiss crypto custodial services supplier, for the sum of $250 million.
Ripple, a cryptocurrency company, announced on Friday it has acquired Fortress Trust, a startup specializing in crypto infrastructure, granting it a license in Nevada and boosting its blockchain-powered payments business. Financial terms of the deal were not disclosed. Founded in 2021 by Scott Purcell, an entrepreneur experienced in equity and debt crowdfunding, Fortress Trust's purpose is to assist large organizations interact with digital currencies. Purcell was formerly CEO of Prime Trust, a crypto custodian which was closed after BitGo decided against purchasing the company.
Ripple is renowned for its involvement with cross-border payments. It employs a blockchain-based messaging system similar to SWIFT to authorize fast transactions between a network of banks and other financial institutions. Among Ripple's associates are Modulr of Britain, Nium of Singapore, and SBI Remit of Japan. Additionally, Ripple utilizes XRP, a cryptocurrency it owns a considerable percentage of and has become attached to, for cross-border payments between banks and other banking entities. XRP's market value did not see an impactful movement in response to this news. The token experienced an upsurge of less than 0.4% in the last 24 hours, trading at a price of fifty cents.
Ripple has been under duress recently due to the U.S. Securities and Exchange Commission's lawsuit claiming XRP should be classified as a security and its executives unlawfully distributed more than one billion dollars worth of tokens to investors. To make matters worse, Ripple's partnership with MoneyGram was also called off in March 2021, after MoneyGram piloted XRP for instant transfers, using the cryptocurrency as a "bridge" currency. Nevertheless, Ripple gained some momentum in July when a judge declared that XRP is "not necessarily a security on its face."
Fortress is Ripple's second purchase this year. In May, the corporation agreed to acquire Metaco, a Swiss company offering crypto custody services, for 250 million dollars. A Ripple spokesperson declined to comment on the size of the deal but said it is smaller than what Ripple paid for Metaco. On top of that, Ripple already had a stake in Fortress Trust's seed funding round.
Ripple said the takeover would "back our existing lines of business — particularly in terms of enriching the customer experience in our payments and liquidity solutions." The business also acquired a Nevada trust with Fortress, which adds to its continuously growing list of regulatory permits worldwide. A company spokesperson explained this would permit the company to "furnish regulated services — for both fiat and crypto — to certain customers in the U.S." Ripple has a New York BitLicense, which permits it to participate in regulated digital currency activities in the state of New York, plus 30 money transmitter licenses nationwide and an in-principle Major Payment Institution License from the Monetary Authority of Singapore, the country's central bank. The company informed CNBC earlier it was also seeking to acquire an e-money license with the Irish central bank.
Ripple is among many players in the so-called "crypto custody" sector, intended to help businesses and individual users store their tokens in a secure, decentralised address without necessitating advanced technical knowledge. Fortress Trust utilizes application programming interfaces, or APIs — programs that enable different apps to communicate with each other — to allow companies to take data from other parts of software, such as wallets holding cryptocurrencies and nonfungible tokens. As mentioned on Fortress's website, the startup works with "crypto exchanges, NFT marketplaces, tokenization platforms, corporate brands, agencies, securities exchanges, real estate, healthcare, neobanks, sports and entertainment celebrities, musicians, influencers and other innovators."
Ripple has announced the acquisition of Fortress Trust, a startup focusing on crypto infrastructure. Through the deal, Ripple has secured a Nevada trust, enhancing its range of regulatory permissions globally. The takeover will also support existing lines of business, particularly with regards to enhancing customer experience with payments and liquidity solutions. Through the purchase, Ripple has obtained an API that provides companies access to data from software that hold cryptocurrencies and nonfungible tokens. Fortress Trust works with services such as crypto exchanges, NFT marketplaces, tokenization platforms, corporate brands, and agencies.
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