Despite a noticeable slowdown, the race for corporate crypto treasuries continues. The latest project: an estimated $1 billion fundraising effort led by Ripple Labs for its XRP cryptocurrency.
Ripple: a $1 billion XRP treasury?
After the euphoria of the first few months, the corporate crypto treasury sector is currently going through a difficult period. The focus is on performances that are supposedly superior to the cryptocurrencies held, which are now turning into a market capitalization that is lower than the funds involved.
However, this setback does not seem to be discouraging the implementation of new projects, as demonstrated by recent rumors reported by the financial media outlet Bloomberg about a corporate treasury applied to Ripple’s XRP cryptocurrency.
According to available information, this operation is currently being carried out by Ripple Labs using a Special Purpose Acquisition Company (SPAC) structure. A special purpose acquisition company is a company that goes public with the aim of acquiring an existing company.
In practice, this operation would consist of accumulating XRP in a publicly traded Digital Asset Treasury (DAT), using external financing, but also XRP held by Ripple, in a proportion that remains unknown at this time.
According to information revealed by Bloomberg, the only amount currently known involves an estimated $1 billion fundraising. This is an ambitious gamble, given the current mistrust of investors in the field, following the mixed performance of the shares of iconic players such as Strategy and Metaplanet.
Ripple targets corporate treasuries
If this project comes to fruition, it would represent the largest fundraising ever recorded in connection with XRP. It would be a way to revitalize its price, following its recent downgrade to fifth place in the cryptocurrency market, behind Binance’s BNB.
At the same time, Ripple announced this week that it is acquiring cash management software provider GTreasury for $1 billion. This is a way to “strengthen its ties with corporate CFOs and treasurers who want access to tokenized deposits, stablecoins, and other digital assets.”
The combined capabilities of Ripple and GTreasury bring together the best of both worlds, enabling treasury and finance teams to finally put their idle capital to work, process payments instantly, and seize new growth opportunities.
Brad Garlinghouse, CEO of Ripple
Ripple currently holds 4.74 billion XRP tokens in its wallets, valued at an estimated $11 billion at the current XRP price. An additional 35.9 billion units may be added to this amount, held in escrow with a scheduled monthly release of 1 billion XRP.
