Ripple Labs Backs Out Of Fortress Trust Acquisition

Updated: 29 September 2023

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Ripple Labs Inc. has backed out of its decision to buy Fortress Trust without citing a reason.

CEO Brad Garlinghouse said in a tweet that Ripple would nonetheless remain an investor in Fortress.

A few weeks ago, we signed a letter of intent to acquire Fortress Trust – we’ve since made the decision not to move forward with an outright acquisition, though Ripple will remain an investor in @Fortress_io.

— Brad Garlinghouse (@bgarlinghouse) September 28, 2023

“The Fortress team is incredibly talented, and has built products solving real customer problems,” he said. “While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future!”

The Fortress team is incredibly talented, and has built products solving real customer problems. While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future!

— Brad Garlinghouse (@bgarlinghouse) September 28, 2023

Ripple Labs Was ”Excited” About Fortress Acquisition

Ripple had announced its plan to acquire Fortress on September 8 in a blog post.

It said then that as an early investor in Fortress it had got to know the company, its vision and technology and said it was “excited“ to bring it aboard to ”accelerate our business and continue pressing our advantage in the areas critical to crypto infrastructure.”

A day earlier, Fortress IO had revealed a theft of customers’ assets that were later revealed to be almost $15 million via a phishing attack on an unnamed third-party vendor.

CoinDesk later identified the vendor as Retool, a San Francisco-based company with Fortune 500 customers, which had built a portal for a handful of Fortress clients to access their funds. Ripple said the acquisition talks predated the theft, but it accelerated them.

CoinDesk reveals that phishing attack on cloud provider, Retool, led to $15M hack on Fortress Trust pic.twitter.com/pJOJDPDZZy

— Messari (@MessariCrypto) September 13, 2023

Fortress IO Customers Attacked Only a Day Before Signing a Deal with Ripple

The company insisted that there was no breach within Fortress Technology’s systems, and said that the affected accounts had been restored in full by the time of the announcement. But soon after the disclosure CoinDesk reported the loss of funds.