SBI Holdings has informed its investors that the conglomerate’s enduring investment in Ripple Labs will not be reflected on its balance sheet until the US fintech either goes public or receives a similar evaluation by a third party, meaning what the management describes as “a significant amount of unrealized profit” remains unacknowledged for now.
This information was included in the company’s fiscal year 2024 results presentation (for the year ending 31 March 2025), showcased on May 9. The consolidated revenue totaled ¥1.443 trillion ($9.39 billion), representing a 19.3% increase compared to the previous year, while pre-tax earnings nearly doubled to ¥282.3 billion ($1.83 billion), largely due to substantial input from private-equity revaluations and a thriving crypto-asset division.
The Hidden Worth of Ripple: SBI
In the private-equity segment, a slide focusing on unlisted investments clarifies the accounting approach regarding Ripple: “The value of shares held by the SBI Group in Ripple Lab Inc., classified as unlisted, will not factor into corporate value until a definite valuation is found through an IPO or alternative methods.”
This valuation aspect is crucial. During the same presentation, executives reminded shareholders that SBI has supported Ripple for over a decade and currently holds “just under 10 percent of the equity stake in Ripple.” Noting Ripple’s current escrow and circulating supply, management projected the hypothetical market capitalization of XRP at “approximately ¥20 trillion ($130 billion)”, while also pointing out that the remaining tokens in escrow “remain locked.”
In an extensive Q&A session, documented and transcribed by commentator Crypto Eri, SBI’s leadership further explained why these gains are not recorded: “The value of XRP in escrow at Ripple Lab will not be counted towards corporate value until a definitive valuation is established through an IPO or similar means. If included, profits would experience a tremendous surge.”
“Since Mr. Trump took office, the US has been increasingly focused on the crypto market, for which we are thankful… If Ripple becomes listed, unrealized profits will be released, and I’m confident they will surpass one trillion yen ($6.5 billion).”
The potential timing for Ripple’s liquidity event has long been a topic of speculation in Tokyo. For years, SBI’s CEO, Yoshitaka Kitao, has expressed his belief that Ripple will go public after resolving its legal situation with the US Securities and Exchange Commission.
This legal issue showed signs of easing only last week: on May 8, the SEC revealed a settlement agreement that lays the groundwork for concluding its 2020 enforcement action against Ripple and two of its executives, pending court approval. While this deal does not provide a formal valuation, it eliminates a regulatory hurdle that had complicated IPO preparations.
SBI’s crypto-asset division reported revenue of ¥80.8 billion ($526 million) and pre-tax earnings of ¥21.2 billion ($138 million), an impressive increase of 151.8% from the prior year, driven by market-maker B2C2 and a growing retail client base at SBI VC Trade. Management termed these results as early indications of “immense growth potential” awaiting liberation once Ripple’s equity is re-evaluated.
SBI’s total assets under management have already exceeded ¥10 trillion ($65 billion); the company reiterated its ambition to double this figure to ¥20 trillion ($130 billion) by the conclusion of FY 2027. A Ripple IPO could facilitate that expansion while altering the risk profile of the private-equity portfolio, as suggested by the presentation.
For the moment, the conglomerate is willing to remain patient. “There are not as many individuals who comprehend our operations,” an executive admitted during the shareholders’ meeting, further noting that even among its staff, “employees may not fully grasp our entire business.” Once Ripple’s valuation is no longer “hidden in plain sight,” SBI believes the forthcoming rewards will be apparent.
As of the latest update, XRP was priced at $2.45.
