Delaware Court Sides With Ripple

The Delaware Chancery Court has rejected Tetragon’s appeal to pull out its equity in blockchain payments firm Ripple Labs. Last year Ripple raised $200 million during the Series C funding round, with Tetragon as the lead investor. The investment contract contained a provision that if XRP is officially declared a security, then Tetragon has the right to request redemption of its ownership shares in cash. Tetragon claimed that the SEC’s enforcement action against Ripple over XRP sales constituted an official securities violation, and therefore Ripple should return the funds. But according to the Delaware court,  “XRP is no more security after the SEC filed the enforcement action than it was before it. The question is not yet resolved, so a determination has not yet been made. And when it is made, it will be made by the District Court.” In a statement, Ripple called the Tetragon lawsuit an “opportunistic move to take advantage of the SEC allegations.”