Ripple has decided not to move with the acquisition of Fortress Trust even though they had previously announced their intentions to expand their US licenses pool just 20 days ago. Brad Garlinghouse, the CEO of Ripple shared this decision on X (formerly known as Twitter) on September 28. While they have chosen not to go through with an acquisition Ripple plans to maintain its ownership in the parent company of Fortress Trust called Fortress Blockchain Technologies.
The initial announcement of the purchase on September 8 surprised people, including those within Ripple itself as reported by Cointelegraph. The plan had included investments in other companies associated with Fortress, such as FortressPay.
Shortly after the acquisition news broke Fortress Trust admitted that they had rushed into the deal following a security breach involving a third party analytics vendor. This breach resulted in a loss of around $12 million to $15 million in Bitcoin. Ripple, which has been an investor in Fortress since its stages in 2022 stepped in to cover these losses for customers.
Scott Purcell, the CEO of Fortress Trust downplayed the termination of the merger. Highlighted that it is unrelated to the security incident. He emphasized that there continues to be a partnership between Ripple and Fortress despite this change, in acquisition plans.
Ripples CEO didn’t offer any comments besides what has already been shared.
Considering Ripples legal challenges with the US Securities and Exchange Commission this canceled agreement could potentially benefit other businesses associated with Fortress.
For example Swan Bitcoin, which is working together with BitGo to create a Bitcoin focused trust company in the US (pending approval) depends on Fortress Trust for secure record keeping. However now that the deal is no longer happening Swan Bitcoins connection with Ripple, in the US has been severed.