- Ex-SEC chief Bill Hinman decided to classify ether as a non-security
- Ripple put 55 billion tokens in escrow at the end of 2017
- Ripple Labs founder Larsen made $453.69 million selling XRP tokens
Following the release of the Hinman documents yesterday, it emerged Ripple founder Chris Larsen and CEO Brad Garlinghouse made more than $600 million from unregistered sales of XRP. As the legal battle between Ripple Labs and the US Securities and Exchange Commission (SEC) rages on, the latest news caused quite a stir in the broader crypto community.
Data revealed that Bill Hinman, ex-chief of SEC’s Division of Corporation Finance Regulation, decided to classify ether as a non-security, ignoring the guidelines of other senior SEC members, The Bitcoinist wrote.
20 billion XRP issued to founders
Ripple Labs initially issued 100 billion XRP tokens and allocated 20 billion of them to founders Chris Larsen, Arthur Britto, and Jed McCaleb. Estimates indicate that Brad Garlinghouse also got a lot of XRP tokens after being appointed CEO.
Ripple put 80 billion XRP in escrow from 2017 to 2019
It emerged that Ripple put 55 billion tokens in escrow at the end of 2017. It is estimated they placed another 25 billion in escrow accounts in 2019, which were subject to restrictions on sales.
At the end of 2020, SEC officially sued Ripple Labs Inc. as well as Larsen and Garlinghouse. At the time, they maintained that both execs held a significant volume of securities. The claim now states they sold more than $600 million worth of unregistered XRP.
Founder made $454M, CEO - $164 from sales
Garlinghouse allegedly earned $164.26 million from token sales from 2017 to 2020. He used primarily foreign exchanges to sell his XRP tokens, and very few US ones. He used Poloniex, Kraken, and Bittrex. His biggest sale was in 2017, when he made just over a quarter of his total profit, pocketing $42.27 million via Bitstamp in a self-directed transaction.
Ripple Labs founder Larsen made $453.69 million selling tokens in the same period. He also used mostly foreign exchanges for the sales. In total, the executives made around $618 million from token sales, which is more than the SEC estimated in their 2020 lawsuit.
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