San Francisco-headquartered enterprise blockchain company Ripple is raising $1 billion via a special acquisition company (SPAC) in order to set up an XRP treasury, Bloomberg reports.
As part of the effort, Ripple will contribute some of its own tokens.
Will XRP price surge?
Ripple is definitely on a roll right now, given that the Bloomberg report comes shortly after the company announced that it had agreed to acquire treasury management company GTreasury for $1 billion.
The bullish news, however, has had virtually no impact on the XRP price, which is down by nearly 3% over the past 24 hours.
As noted by analyst Bill Morgan, Ripple announcements rarely have an immediate or short-term impact on the price of the token, especially when it is not immediately obvious how they will affect XRP.
Too late to the party?
Ripple's entry into the digital asset treasury (DAT) space comes at a time when the euphoria surrounding this business model, pioneered by Strategy's Michael Saylor, has already peaked.
Even permabull Tom Lee, who rose to prominence after spearheading BitMine's transformation into an Ethereum treasury firm earlier this year, recently admitted that the bubble has seemingly burst.
In a stunning reversal, many DAT firms, including such prominent names as Metaplanet, are now trading below their net asset value.
Other XRP treasury players
Unlike Bitcoin and Ethereum, XRP has attracted relatively little attention from DAT firms.
However, there are still several names that have adopted the token as a treasury asset. These include VivoPower International, Webus International, Wellgistics Health, Trident Digital Tech, and some other minor players.
As reported by U.Today, Bitwise CEO Hunter Horsley previously predicted that Ripple could be viewed as an XRP treasury company.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team