Ripple has bought Switzerland-based crypto custody firm Metaco, the companies said Wednesday. The deal is reportedly worth $250 million.
Metaco offers services to help financial institutions store, trade, issue and manage digital currencies securely. It counts banks such as Citi, BNP Paribas, BBVA and Societe Generale as clients.
The bankruptcies, over the past year, of former crypto heavyweights such as FTX, Celsius and BlockFi have underlined security concerns for companies looking to grow by entering the digital asset space.
"There's a lot of deals people have tried to do during this crypto winter,” Ripple CEO Brad Garlinghouse told CNBC. “I think this will really be a mark of a crypto spring.”
That Metaco is Switzerland-based added to its appeal, Garlinghouse told Reuters.
"The rules of the road in other markets compared to the United States are clear and it's that clarity of rules that allows companies to invest," he said.
Ripple has been locked in a court battle for nearly 2½ years with the Securities and Exchange Commission, which sued the company claiming its XRP token is an unlicensed security. XRP lost 60% of its value in the week after the suit, and the token has fallen from the world’s third-largest cryptocurrency to its sixth, with about $23 billion in circulation, according to CoinGecko.
Garlinghouse told CNBC he expects a decision in the court case “sometime either two to four or five months from now.” He told the network last week that Ripple will have spent roughly $200 million defending itself in the SEC case — nearly the amount of Wednesday’s transaction.
As part of the deal, Metaco will remain independent and its CEO, Adrien Treccani, will stay in that role.
“Our mission has always been to enable institutions to thrive in the digital asset economy with the help of our core infrastructure and expertise, and we are delighted to join forces with the team at Ripple, who share that passion,” Treccani said in a statement. “This deal will enable Metaco to leverage Ripple’s scale and market strength to reach our goals and deliver value to our clients at a faster pace.”
Ripple paid for more than half of the acquisition in cash, with the rest in equity, the company told Reuters.
Garlinghouse praised Metaco for what he labeled its “exceptional executive bench and a truly unmatched customer track record.”
“Bringing on Metaco is monumental for our growing product suite and expanding global footprint,” he said in a statement.
Crypto regulation in the U.S., meanwhile, has been the subject of copious debate. The SEC has notified several leading companies of its intent to sue over the alleged selling of securities. Coinbase, which halted at least one product over the threat, has long accused the agency of regulating by enforcement, and sued the regulator last month to prod it to divulge how it defines a security.
Coinbase in 2021, published a policy document pushing for the creation of a new regulator devoted specifically to digital assets. Ripple, the following month, indicated it favored putting digital assets under the purview of the Commodity Futures Trading Commission.
