John Deaton Leads Investor Fight in Linqto Bankruptcy as Ripple Shares Remain Secure

Highlights:

• John Deaton explains that the customers on Linqto have a first claim to bankruptcy before the equity shareholders.
• Ripple confirms Linqto holds 4.7 million shares bought on the secondary market.
• Circle and Ripple shares have increased significantly, boosting recovery chances for investors.

The ongoing Linqto bankruptcy has caused widespread concern among thousands of retail investors. These investors purchased private shares in firms such as Ripple, Circle, and SpaceX on the platform. However, full or substantial recovery of assets may be a possibility as per the legal updates.

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John Deaton, an XRP lawyer, has become a key voice in the case. According to him, Linqto customers would be a priority in the recovery of assets since they are the only key creditors ahead of them in the queue of bankruptcy. Consequently, investors are likely to make higher returns than their initial investments.

MY RESPONSE TO ALL THE EXPERTS REGARDING LINQTO

As I said during the spaces, anyone who claims they know exactly what will happen in bankruptcy is either ignorant, lying, or intentionally spreading fear, causing innocent people to stress more than necessary.

Some people have… https://t.co/IjzyGruqXX

— John E Deaton (@JohnEDeaton1) July 3, 2025

Linqto provided fractional ownership of pre-IPO stocks of the leading privately held firms, such as Ripple, Circle, SpaceX, and Kraken. The investors purchased the SPV units, which are legally acceptable entities that purchase the shares on their behalf. There are reports of 11,500 individuals who possess such units pertaining to Ripple only.

Ripple Shares Remain Safe and Accounted For

Ripple CEO Brad Garlinghouse acknowledged that Linqto holds 4.7 Ripple shares. This was a purchase of the shares in the secondary market and not in Ripple itself. Ripple also clarified that there is no business affiliation between the two companies, and it did not give permission for the resale of shares.

Understandably, there have been many questions from those who believed they were buying Ripple shares from Linqto, and what happens next. To be clear, on Ripple’s end:

What we know from our records is Linqto owns 4.7M shares of Ripple, solely purchased on the secondary market… https://t.co/XHstpwwmIL

— Brad Garlinghouse (@bgarlinghouse) July 2, 2025

Ripple recently reacquired a number of shares at the price of $175 per share. Assuming that this valuation is applicable to the Ripple holdings of Linqto, they would be worth more than $800M. Moreover, Linqto owns Circles shares, which have increased more than sixfold, boosting the possible recovery value further.

Deaton highlighted that such resources remain intact and are accounted for. His team is trying to make sure that investors get what they are entitled to according to the present share values. The legal focus is concerned with safeguarding the interests of the customers and ensuring that the share values are realistic in the market.

All Linqto Bankruptcy Dealings Headed for Full Transparency

According to Deaton, all internal records will be publicly disclosed by the court. These include transactions of the investors, marketing emails, and partner communications. This will be transparent enough to show who knew what and when, particularly in cases of mismanagement allegations.

Three former workers and three influencers said that they invested huge amounts of money without being aware of the firm’s malpractices. Linqto is claimed to have illegally conducted practices under the previous CEO, William Sarris. He is claimed to have sold his Ripple at high markups, raking in a profit of up to $2 million without customer awareness. Those actions are currently under investigation by the SEC and the DOJ.

Earlier on, Linqto had suggested refunding customers only their initial investments. This was greatly opposed by Deaton. He cited personal examples of shares that were purchased using Linqto and skyrocketed in value. Furthermore, he cautioned that reimbursing the principal investments would heavily undermine the investor’s profits.

Despite the Linqto bankruptcy controversy, Deaton remains confident. In case of cooperation between parties, he assumes that a reasonable solution might be achieved within a year. Otherwise, protracted litigation may depreciate investor value in the long run. Still, he’s actively working to ensure customers are not left behind.

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