Ripple Labs plans to purchase a huge amount of XRP for its reserve through a new digital asset treasury company. The company, already a significant holder of XRP, will increase its stash as several corporations’ strategy aligns with the market. This move is bullish for the altcoin, facing prolonged sideways trading despite positive projections.
Ripple Targets $1 Billion XRP Bag
The company is reportedly considering a new fundraising to purchase $1 billion worth of XRP in its digital asset treasury. According to Bloomberg, citing sources familiar with the matter, the fundraising will be conducted through a special purpose acquisition company (SPAC).
Ripple will add its own XRP reserves to the treasury company, although the full terms of the agreement have not been disclosed. For most crypto users, this purchase is strategic to end the year for the asset. The institutional favorite became more dominant this year, and the $1 billion scoop can serve as a major boost.
At the moment, Ripple holds 4.5 billion XRP and looks to purchase 427 million tokens. This move is likely to consolidate and stabilize the market in the wake of new inflows to the industry. XRP has a total circulating supply of 59 billion tokens, while Ripple controls 37 billion in escrow in addition to its holdings. The firm releases the assets monthly through sales, while any remaining assets are returned to escrow.
Ripple’s plan comes as the firm recently acquired GTreasury, marking another milestone for the firm. Per the press release, Ripple will attract idle capital and venture into a trillion-dollar market. The purchase underscores Ripple’s expansion plans to become the leading player in cross-border payments. This year, the company acquired prime broker Hidden Road stablecoin payment firm Stellar Rail.
“We have focused on providing the most compliant and feature-rich solutions to corporations around the globe. Now, by joining Ripple, we are accelerating our vision from managing capital to activating it,” says Renaat Ver Eecke, GTreasury CEO. “The combination of our cash forecasting, risk management, and compliance foundation with Ripple’s speed, global network, and digital asset solutions creates an opportunity for treasurers to manage liquidity, payments, and risk in the new digital economy.”
XRP has dipped this week as bulls stall inflow into major assets. Down 2% in the last 24 hours, institutional investors are keen on new swings leveraging on macro tailwinds.