Ripple CEO Brad Garlinghouse said the company was financially stable in the wake of the Silicon Valley Bank (SVB) collapse.
Setting the record straight on SVB Qs:
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.
— Brad Garlinghouse (@bgarlinghouse) March 12, 2023
He noted that the company had deposits at SVB, but most of the funds were withdrawn.
“Obviously, there is still a lot that is unknown about what’s happening with SVB, as with many other companies; we hope to receive more detailed information soon, but rest assured — Ripple has a strong financial position,” Garlinghouse added.
In his view, the current situation demonstrates how badly broken the financial system is.
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.
— Brad Garlinghouse (@bgarlinghouse) March 12, 2023
“[…] transfers do not operate 24/7, rumors lead to collapse and frictions in moving funds within a deeply fragmented system,” explained the Ripple CEO.
On March 10, the California Department of Financial Protection and Innovation shut down SVB due to “insufficiency of liquidity and insolvency” and handed control to the United States Federal Deposit Insurance Corporation.
Under the bank’s management, around $209 billion was held, and total deposits reached about $175.4 billion.
Against the SVB collapse, the stablecoin USDC and the algorithmic ‘stablecoins’ DAI and FRAX lost their peg to the US dollar.
Earlier on March 11, Elon Musk stated there was a possibility of purchasing the bank closed by authorities.