Ripple will have spent $200 million fighting SEC lawsuit, CEO says
Ripple CEO Brad Garlinghouse speaks during the Milken Institute Global Conference in Beverly Hills, California, on Oct. 19, 2021.
Kyle Grillot | Bloomberg | Getty Images
Ripple will have spent $200 million defending itself against a lawsuit from the U.S. Securities and Exchange Commission by the time it is over, CEO Brad Garlinghouse told CNBC Monday.
“With the SEC, we will spend — this is the first time I’ve shared this publicly — by the time all’s said and done, we will have spent $200 million defending ourselves against a lawsuit, which from its very beginning, people were like, well, this doesn’t make a lot of sense,” Garlinghouse said during a fireside chat with CNBC’s Dan Murphy at the Dubai Fintech Summit.
The SEC accuses Ripple, CEO Brad Garlinghouse, and co-founder Chris Larsen of breaching U.S. securities laws by selling XRP (a cryptocurrency closely associated with Ripple) without first registering it with the regulator. Ripple contests the SEC’s allegations, maintaining the view that XRP should be considered a digital currency rather than a security.
Ripple isn’t the only company the SEC has pursued enforcement action against. The watchdog required Kraken, a crypto exchange, to stop offering its so-called staking service that offers users interest-like yields on their tokens after settling charges that it sold unregistered securities.
Meanwhile, the regulator has also notified crypto exchange Coinbase that it plans to sue the company over alleged securities violations. The crypto industry has been up in arms about the actions taken by the SEC, with some figures warning it may force companies outside the U.S.
Much of what the SEC has done involves applying existing regulations to the crypto industry, which was formed several decades after the Howey Test — one of the key tests to determine whether something is a security or not.
Garlinghouse said Chairman Gary Gensler and other SEC officials have made statements in the past which contradict the regulator’s belief that XRP is a security.
“You have video footage of the chair of the SEC, as a professor at MIT, saying 75% of these digital assets are commodities,” he said. “And now he says they’re all securities because he’s the head of the SEC and he’s seeking power and he’s putting power ahead of sound policy to grow an economy in the United States.”
The SEC was not immediately available for comment when contacted by CNBC.
In 2020, the U.S. Securities and Exchange Commission initiated a lawsuit against Ripple alleging the company and its executives illegally sold XRP, a cryptocurrency its founders created in 2012, to investors without first registering it as a security.
Ripple disputes the claim, saying the token should not be considered an investment contract and is used in its business to facilitate cross-border transactions between banks and other financial institutions.
Beta Technologies shares surged more than 9% after air taxi maker Eve Air Mobility announced an up to $1 billion deal to buy motors from the Vermont-based company.
Eve, which was started by Brazilian airplane maker Embraer and is now under Eve Holding, said the manufacturing deal could equal as much as $1 billion over 10 years. The Florida-based company said it has a backlog of 2,800 vehicles.
Shares of Eve Holding gained 14%.
Eve CEO Johann Bordais called the deal a “pivotal milestone” in the advancement of the company’s electric vertical takeoff and landing, or eVTOL, technology.
“Their electric motor technology will play a critical role in powering our aircraft during cruise, supporting the maturity of our propulsion architecture as we progress toward entry into service,” he said in a release.
Mateusz Slodkowski | SOPA Images | Lightrocket | Getty Images
Amazon’s cloud unit on Tuesday announced AI-enabled software designed to help clients better understand and recover from outages.
DevOps Agent, as the artificial intelligence tool from Amazon Web Services is called, predicts the cause of technical hiccups using input from third-party tools such as Datadog and Dynatrace. AWS said customers can sign up to use the tool Tuesday in a preview, before Amazon starts charging for the service.
The AI outage tool from AWS is intended to help companies more quickly figure out what caused an outage and implement fixes, Swami Sivasubramanian, vice president of agentic AI at AWS, told CNBC. It’s what site reliability engineers, or SREs, do at many companies that provide online services.
SREs try to prevent downtime and jump into action during live incidents. Startups such as Resolve and Traversal have started marketing AI assistants for these experts. Microsoft’s Azure cloud group introduced an SRE Agent in May.
Rather than waiting for on-call staff members to figure out what happened, the AWS DevOps Agent automatically assigns work to agents that look into different hypotheses, Sivasubramanian said.
“By the time the on-call ops team member dials in, they have an incident report with preliminary investigation of what could be the likely outcome, and then suggest what could be the remediation as well,” Sivasubramanian told CNBC ahead of AWS’ Reinvent conference in Las Vegas this week.
Commonwealth Bank of Australia has tested the AWS DevOps Agent. In under 15 minutes, the software found the root cause of an issue that would have taken a veteran engineer hours, AWS said in a statement.
The tool relies on Amazon’s in-house AI models and those from other providers, a spokesperson said.
AWS has been selling software in addition to raw infrastructure for many years. Amazon was early to start renting out server space and storage to developers since the mid-2000s, and technology companies such as Google, Microsoft and Oracle have followed.
Since the launch of ChatGPT in 2022, these cloud infrastructure providers have been trying to demonstrate how generative AI models, which are often training in large cloud computing data centers, can speed up work for software developers.
Over the summer, Amazon announced Kiro, a so-called vibe coding tool that produces and modifies source code based on user text prompts. In November, Google debuted similar software for individual software developers called Antigravity, and Microsoft sells subscriptions to GitHub Copilot.
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