Complaint: Ripple Labs, Inc. (“Ripple”), Bradley Garlinghouse (“Garlinghouse”), and Christian A. Larsen

XRP, we had continued to hear concerns in the market that Ripple could 
(hypothetically) sell our 61 billion XRP at any time – a scenario that would 
certainly be bad for Ripple! So with the decision to lock up 55 billion XRP in 
escrow, we have given investors a predictable supply schedule and removed 
what skeptics have suggested has been a barrier to broad XRP adoption. . . . This 
recognition has translated into significant improvements in both the 
liquidity (trading volume) and price of XRP. We saw nearly $6 billion in 
trading volume in May alone and XRP is now hovering around $0.30, up 
approximately 500 percent in the last 30 days and over 5,000 percent from 
the beginning of 2017! . . . In fact, factoring in the approx. $18 billion of XRP 
we own, Ripple is worth more than all but four US start-ups. 
Case 1:20-cv-10832 Document 4 Filed 12/22/20 Page 38 of 71

---

39 
228. In the same email, Garlinghouse reminded Ripple’s equity investors and advisors that 
Ripple remained “committed to making XRP the best digital asset for payments” and that XRP had 
“technical superiority compared to other digital assets.” 
229. Garlinghouse had made statements similar to these in an article posted on Ripple’s 
website on May 16, 2017. A few months later, in a December 7, 2017 post on its website, Ripple, 
confirming the formation of the XRP Escrow, once more reiterated Garlinghouse’s statements in 
the May 16, 2017 article and the June 5, 2017 email, described above. 
230. In a December 14, 2017 public interview, Garlinghouse explained Ripple’s market 
monitoring priorities as follows: “Priority one is definitely around volume. Priority two, I would 
say, is XRP liquidity. Making sure . . . we are doing everything we can to make the XRP ecosystem 
successful on a liquidity basis. Priority three which admittedly is kind of a newer priority and 
something we’ll work on more in 2018, is investing in other use cases for the XRP Ledger.” 
231. In the Markets Report for the fourth quarter of 2017, Ripple stated that “it’s clear 
Ripple’s consistent steadfast support of XRP is a major advantage as the payments industry 
continues to seriously consider [XRP] as an alternate liquidity solution.” A Ripple executive 
similarly explained his view in a Yahoo! Finance interview on approximately March 15, 2018, that 
“the activities of the software company create value in . . . [XRP].” 
232. Also in the Markets Report for the fourth quarter of 2017, Ripple announced its 
upcoming intended efforts to “work towards the launch of institutional hedging instruments and 
custody solutions,” which “are important to institutional adoption [i.e., key forces in achieving 
liquidity and price increases] and thus are important components of our 2018 roadmap.” 
233. On September 11, 2017, Cryptographer-1 told public markets via a post on Reddit 
that, because “Ripple holds more than half the XRP in existence[,] . . . Ripple can justify spending 
$100 million dollars on something if it would be expected to increase the long term price of XRP by 
Case 1:20-cv-10832 Document 4 Filed 12/22/20 Page 39 of 71

---

40 
a penny.” Then, on November 17, 2017, he posted on Reddit about why Ripple had an incentive to 
continue these efforts and why it would continue these efforts: “[T]here is no rational reason why 
[Ripple] would not continue to execute [its] publicly announced strategy and do everything we can to 
maximize the price of XRP over at least the time it takes us to sell the XRP we have.” 
234. On January 17, 2018, Garlinghouse tweeted an article he said was “[a] good read on 
why fostering a healthy $XRP ecosystem is a top priority at @Ripple.” 
235. On February 17, 2020, Garlinghouse tied Ripple’s efforts to create “use”-driven 
demand for XRP to a potential for an increase in XRP price, in an interview on the floor of the New 
York Stock Exchange in Manhattan (the “NYSE Interview”). 
236. In the NYSE Interview, Garlinghouse answered questions about the price of digital 
assets by predicting that markets would move “from that speculation that has driven the crypto 
market to utility.” He stated that increased “use” of XRP had generated liquidity in the market for 
XRP and that “liquidity begets liquidity,” such that market markers “see liquidity and they realize 
‘hey there is an opportunity there’.” Tying this to Ripple’s significant efforts, Garlinghouse 
promised: “Over the coming years . . . we Ripple are focused on driving utility from this asset and if 
we are successful at that we think that is good for the liquidity of the whole ecosystem.”