Ripple Targets $1 Billion XRP Treasury Via SPAC Initiative: Report

Highlights:

• Ripple Labs plans to raise $1 billion through a SPAC to build an XRP treasury.
• The initiative could make Ripple the largest institutional XRP holder.
• Ripple plans to combine investor funds with its existing XRP reserves.

Ripple Labs is moving towards raising $1 billion to create a digital-asset treasury focused on XRP. The fundraising, which was disclosed by Bloomberg, will be implemented via a special purpose acquisition company. Ripple plans to utilize this vehicle to expand its presence in the corporate digital-asset market.

The strategy comes after the recent turbulence in the crypto markets, which saw more than $19 billion of liquidations in the industry. Despite the uncertainty, the ambition of Ripple reflects their confidence in the long-term value of XRP. The company plans to combine investor capital with current XRP reserves, which will enhance its status as a key institutional investor.

As per the Bloomberg sources, the discussions concerning structure and timing are still ongoing. As part of the deal, Ripple may contribute a portion of its 4.7 billion XRP. A successful proposal of the treasury would result in Ripple being the largest institutional manager of XRP in the world.

XRP Treasury Model Gains Momentum

The concept of an XRP treasury is not novel. A number of companies have also initiated the same in recent months. In Singapore, companies such as Trident Digital have already committed up to $500 million to XRP reserves.

Furthermore, Nature’s Miracle and Thumzup Media have already made investments in XRP treasury programs, but on smaller scales. This month, another company, Reliance Global, added XRP to its digital asset treasury. However, the proposed move by Ripple of $1 billion would be ahead of the pack.

Digital-asset treasuries (DATs) have become the latest trend as companies seek alternative methods of holding crypto assets in the balance sheet. However, the model has also come under criticism since the market’s volatility questions its sustainability. More than 300 companies reportedly maintain Bitcoin treasuries, although XRP treasuries are considerably fewer. Firms like Strategy and Metaplanet have experienced devaluation lower than their underlying crypto assets.

However, Ripple does not seem to be deterred. Its approach integrates profound liquidity and corporate form, which offers a stable pattern of digital reserves. 37 billion XRP are already locked up by the company in the long-term escrow program, which provides controlled releases in the market.

Should Ripple’s plan be successful, it might redefine the way corporations treat XRP as a strategic reserve. This initiative also indicates the transition from the Bitcoin and Ethereum dominance to a more diversified digital asset range.

Ripple Expands with GTreasury Acquisition

The XRP treasury move follows Ripple’s acquisition of Chicago-based GTreasury, a leading treasury management software maker, in a deal worth $1 billion. The acquisition strengthens the liquidity management, cash forecasting, and compliance capabilities of Ripple. GTreasury’s platform has clients in more than 160 countries, providing Ripple with a global foundation to grow its treasury.

Ripple intends to combine the experience of GTreasury with its blockchain payment network. Collectively, they seek to open up new services like real-time cross-border settlements and access to global repo markets. The acquisition also enhances Ripple’s pitch to corporate treasurers seeking access to tokenized assets.

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