Ripple CEO Brad Garlinghouse took to Twitter on March 12 to discuss the company’s exposure to Silicon Valley Bank (SVB) and reassure his followers about Ripple’s stability.
Ripple had exposure to SVB, Garlinghouse said, but “we do NOT expect disruption to our day-to-day operations and already held a majority of our USD with a broader network of banking partners.”
His short tweet thread was intended to reassure users. “Rest assured, Ripple remains in a strong financial position,” he tweeted.
To straighten the record on SVB Qs:
Ripple had some exposure to SVB – it was a banking partner and had a share of our cash balance. Fortunately, we do NOT expect disruption to our day-to-day operations and already held a majority of our USD with a wider network of banking partners.
— Brad Garlinghouse (@bgarlinghouse) March 12, 2023
Garlinghouse did not specify how much cash the company had in SVB.
Many Twitter users who commented on the thread responded positively to the statement:
“I never doubted that you or @Ripple had good risk management practices,” one user wrote.
I never doubted you or @Ripple to have taken good risk management. Thanks for the statement.
— EarthAngel.XRP☀️ (@EarthAngel_Xrp) March 12, 2023
David Schwartz, Chief Technology Officer of Ripple promised on March 11 that the company would “soon” release a statement about its Ripple exposure, though it’s not clear that the Garlinghouse tweet was what he had in mind.
Hours later, the Federal Reserve announced it had created a $25 billion funding program to help banks with liquidity during times of financial stress.
In another announcement, the Federal Reserve also noted that all Silicon Valley Bank depositors will have access to all of their money beginning Monday, March 13.
“Losses associated with the resolution of Silicon Valley Bank will not be borne by taxpayers,” it added.
Related: Ripple Survey: 97% of payment companies believe in the power of crypto
Schwartz noticed on March 10 “I still don’t understand how a run on a bank can cause it to become insolvent. If the bank was previously solvent, it means that its assets exceed its liabilities. […] They probably would have become solvent against [sic] as their 10-year Treasury matured. But they didn’t get that chance because of a point.”
The price of Ripple’s XRP (XRP) fell from a high of $0.40, rising against market trends, on March 9 to a low of $0.35 on March 12 before recovering.
Ripple is in a legal battle with the US Securities and Exchange Commission over the status of their XRP cryptocurrency, but a Ripple executive called 2022 “record year of business and customer growth” for the company. Garlinghouse said in January that he expected the matter to be resolved by June.