Ripple Reveals 'Some Exposure' To Silicon Valley Bank, But CEO Assures 'Strong Financial Position'

Brad Garlinghouse, the chief executive officer (CEO) of the cryptocurrency business Ripple Labs, has spoken up about the company's exposure to the startup-focused lender Silicon Valley Bank (SVB), whose sudden collapse a few days ago roiled global markets and grounded billions of dollars of investors and companies' funds.

Following speculations on social media platforms about the potential exposure of Ripple Labs to Silicon Valley Bank, its CEO finally shed some light on the matter and confirmed that while the crypto company had "some exposure" to the bank, it "remains in a strong financial position."

While fighting the U.S. Securities and Exchange Commission (SEC) in an ongoing lawsuit over the status of its cryptocurrency XRP, Ripple Labs stored some of its cash reserves at the now-collapsed bank.

"Ripple had some exposure to SVB – it was a banking partner, and held some of our cash balance. Fortunately, we expect NO disruption to our day-to-day business, and already held a majority of our USD w/ a broader network of bank partners," Garlinghouse tweeted over the weekend to set the "record straight on SVB" questions.

"Obviously a lot is still unknown about what happens with SVB, and as is the case with many others, we hope to have more details soon – but rest assured, Ripple, remains in a strong financial position," the CEO said in a follow-up tweet.

"It's ironic that so much of what's happening (as some companies scramble to make payroll) highlights how broken our financial systems still are - i.e. wires are still not 24/7/365, rumors lead to collapse and the frictions of moving money within a deeply fragmented system," the executive said in another tweet.

Ripple is the latest cryptocurrency company to make a statement on its link to Silicon Valley Bank which failed Friday after a run on deposits forced regulators to subject its remaining assets to the control of the Federal Deposit Insurance Corporation (FDIC) - the agency created by Congress to maintain stability and public confidence in the country's financial system.

Earlier this month, David Schwartz, the chief technology officer at Ripple, floated the possibility of Ripple Labs seemingly considering shutting its operations in the United States because of the ongoing crackdown on cryptocurrency companies and businesses initiated by the country's regulators.

"I hope we don't run into a situation where we have to make any choice like that," Schwartz said, adding, "Keep in mind, while the stakes are high, they're not quite as high as this suggests. After all, this is only the US. There's quite a bit more to the world. And Congress can change the laws."