Rumors Circulate That Ripple Is Buying $1 Billion Worth Of XRP — Here’s What We Know
Crypto firm Ripple is reportedly set to raise up to $1 billion to set up an XRP treasury firm. The firm is notably the largest XRP holder and plans to contribute some of its holdings to this proposed venture.
Ripple To Raise $1 Billion For XRP Treasury
According to a Bloomberg report, Ripple is leading an effort to raise at least $1 billion to buy XRP. These coins will be held by a new digital-asset treasury firm, which will hold XRP as its primary reserve asset. Meanwhile, the crypto firm plans to raise this sum through a special purpose acquisition company (SPAC).
The proposed XRP treasury firm by Ripple could become the largest in the U.S. if it raises up to $1 billion to buy XRP. Meanwhile, Bloomberg reported that Ripple also plans to contribute some of its own XRP to facilitate this move. The crypto firm is the largest XRP holder, holding over 40% of the token’s total supply, including its holdings in escrow.
It is worth noting that XRP Ledger (XRPL) validator Vet revealed that Ripple sent $500 million in XRP to a new account. He said that the account is not escrowed and doesn’t have multi sig, which he claimed is surprising given the account value. This has led to speculation that the transfer may be related to the $1 billion treasury firm the crypto firm is looking to set up.
In addition to the $1 billion fundraise for an XRP treasury firm, Ripple also recently acquired GTreasury for $1 billion, expanding into the corporate treasury markets. This is also considered another major win for XRP, as Ripple and GTreasury plan to let customers use the crypto firm’s payment solution for real-time cross-border transactions, which they facilitate using XRP.
Significance Of The XRP Treasury Firm
XRP commentator Kahneman noted the significance of the SPAC in Ripple’s plans to set up a $1 billion XRP treasury firm. He explained that this would be a publicly disclosed, regulated liquidity pool capable of handling corporate treasury flows. Meanwhile, Ripple just bought GTreasury, meaning that both moves could be intertwined.
Kahneman further remarked that a SPAC would let the payment firm offer a regulated liquidity pool that corporate treasuries can use, even though the crypto firm is a private company. He added that this separates Ripple’s operating business from a compliant pool.
Therefore, the XRP commentator opined that this could signal that the crypto firm intends to remain private for a while longer. Ripple has so far not revealed any plans for a potential IPO despite the XRP lawsuit already ending.
At the time of writing, the XRP price is trading at around $2.32, down in the last 24 hours, according to data from CoinMarketCap.
Featured image from iStock, chart from Tradingview.com
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