R3 Should Just Buy Ripple

Previously, we made fun of R3 for complaining about a billion-dollar Option Contract that Ripple decided to terminate. R3 should have used a smart contract!

Now we have the actual court documents (thanks @MrDuke67).

According to Ripple, the Option was given to R3 in exchange for a technology and commercial partnership. Ripple claims that they were fraudulently misled into the partnership, and that R3 failed to deliver anything of value. Not only does Ripple want the agreements declared invalid, they also want R3 to pay punitive damages and legal fees:

But according to R3’s complaint, the Option had no strings attached:

I can’t help but feel sorry for Ripple here. It’s hard to imagine anyone agreeing to a partnership with R3 unless fraudulently induced, and the Option contract does kinda look like a freebie (full text here).

To make matters worse, the Option contract is now worth over a billion dollars, which is almost certainly more than Ripple’s entire company valuation (They raised $55M in last year’s Series B).

So here’s a modest proposal that should make everyone happy:

  • R3 goes to one of its banking partners for a billion-dollar loan*, using the XRP Option as collateral.
  • R3 acquires Ripple for a mix of cash and stock, up to a billion dollars.
  • Withdraw the complaints, exercise the Option, sell the XRP, pay back the loan in full.
  • Burn Ripple’s business to the ground.

Lo and behold, we’ve created shareholder value for all. Blockchains really are like magic.

*Better yet, tokenize the Option Contract and do an ICO.

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