Ripple Plans $285 Million Share Buyback
Ripple, the company behind XRP, is reportedly preparing to buy back shares worth $285 million from its early investors and employees. According to anonymous sources, the tender offer would value Ripple at $11.3 billion, and participants would only be able to sell up to 6% of their stake.
Ripple’s $500 Million Buyback Plan
Ripple has confirmed the news and stated that it will spend $500 million on the buyback, which will cover taxes and conversion costs related to restricted stock units. Ripple CEO Brad Garlinghouse emphasized that the company has no immediate plans for an initial public offering (IPO) due to regulatory uncertainty in the United States.
Creating Investor Liquidity
Garlinghouse explained that future share buybacks will be a regular occurrence for Ripple in order to provide liquidity for its investors. He also revealed that Ripple’s balance sheet currently holds over $26 billion, primarily in XRP.
XRP’s Market Cap and Lawsuit Victory
The total market capitalization of XRP is approximately $31 billion. In March, XRP’s value surged after Ripple won a lawsuit against market regulators, confirming that XRP is not considered a security. However, the cryptocurrency has since retraced all of its gains.
“Growing in the headwinds of the SEC lawsuit was certainly a challenge, but 95% of our customers are non-US financial institutions,” said Garlinghouse.
Ripple’s Payments Business
Garlinghouse declined to disclose the size of Ripple’s payments business.
Hot Take: Ripple Invests in Its Own Future
Ripple’s decision to buy back shares demonstrates its confidence in the company’s growth and potential. By providing liquidity for its investors, Ripple aims to attract more interest and support in the market. Despite the challenges posed by the SEC lawsuit, Ripple remains focused on serving its non-US financial institution customers and expanding its presence in the industry.
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