Brad Garlinghouse Confirms Ripple Has No Business Relationship with Linqto Amid Federal Investigation

Ripple’s CEO, Brad Garlinghouse, has clarified the confusion surrounding the company’s relationship with investment platform Linqto

Garlinghouse issued the clarification while responding to reports of the U.S. Department of Justice (DOJ) probe into Linqto and the company’s potential bankruptcy filing

No Business Relationship with Linqto

This indicates that Ripple did not issue its pre-IPO shares directly to Linqto. Moreover, Garlinghouse asserted that Ripple does not have any business relationship with Linqto other than the company being a pre-IPO shareholder

He also confirmed that Linqto has never participated in any of Ripple’s fundraising campaigns

Linqto’s Offering of Ripple Pre-IPO Shares

Notably, Linqto has been offering non-accredited investors an opportunity to invest in pre-IPO shares of top companies, including Ripple, in anticipation of a potential IPO

On several occasions, Linqto’s pre-IPO Ripple shares have sold out within hours, due to the surge in interest in Ripple. A case in point was in October 2023, when Linqto reopened another pre-IPO stock buying opportunity for Ripple shares after previously selling out

However, investors have been skeptical about Linqto’s business model, with some users expressing concerns on X. As a result, Ripple halted the approval of Linqto’s additional purchase of its shares via the secondary market in late 2024

Notably, Garlinghouse’s comments are part of an effort to distance Ripple from the regulatory and legal concerns tied to Linqto’s business model

Linqto Faces Regulatory Scrutiny

For context, concerns about Linqto’s business model began in November 2024. At the time, The Crypto Basic reported that Gene Zawroty, Linqto’s former Chief Revenue Officer (CRO), sued the company and two other executives for fraud, market manipulation, and insider trading

Currently, federal investigators are also examining the company’s operations, with reports suggesting that Linqto may face potential bankruptcy. In a previous statement, former U.S. Senate Candidate John Deaton confirmed that the SEC and another three-letter federal agency are also probing Linqto’s business model.

According to him, the pre-IPO shares that Linqto offers do not belong to Ripple. He suggested that they are owned by a Special Purpose Vehicle (SPV), which holds pre-IPO shares in Ripple