Cryptocurrency

Ripple prior to the IPO? – Impact on XRP price

For Ripple and XRP a very interesting year. A few weeks ago Ripple was able to collect 200 million USD in Series C round of financing. Maybe the next one is already in front of the door. At the world economic forum in Davos, Brad garlinghouse, the CEO of Ripple betrayed, some Insights on a timely IPO (=Initial Public Offering), on a Börsergang of Ripple to close. In this article, we look at what are the potential consequences of an IPO for XRP had.

Ripple’s XRP sales the reason for an IPO?

2019 was a successful year for Ripple and a fairly sobering for the XRP price. The XRP price had to temporarily suffer over 50% loss in value. The commercial Use of XRP was able to withdraw through MoneyGram, strong. One of the reasons for such a strong price decline, the sale of XRP by Ripple is, among other things. The company still has about 55% of all the XRP.
Ripple has responded to the criticism on the part of the Community and promised to sell less XRP in the future. Already in December 2019 Ripple actions has consequences and the monthly shared 1 billion XRP to the trust (Escrow) be returned. Maybe this is one of the reasons why money in the various rounds of financing is collected. The company was able to collect up to now, the sales of the XRP, a total of more than $ 1.2 billion.

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Ripple was measured on a 10 billion USD

At the world economic forum in Davos, Garlinghouse said:

I think in the next 12 months, you will definitely enjoy the IPOs in the Crypto and Blockchain – area. I’m not sure whether we want to be the First, but we certainly don’t want to be the Last. So I expect that we will be at the top, not on the weak side.

Thus, it is probably out of the question, that Ripple draws a IPO into consideration. When this will take place will be clear soon in the next few weeks or months out. At the last financing round Ripple 200 million USD was able to collect, at a valuation of 10 billion USD. The rating is probably also the XRP of the company have been taken into account to a certain extent. These have at the current time, a value of about 12.5 billion USD.

The potential impact on the XRP price

But what does this mean for the XRP price? A further round of funding would give Ripple a little more room to play, without the need to own XRP to sell. This would initially flow, no new XRP in the market and the price to put pressure on you. This could give the XRP price more room to Breathe and the criticism from the Community for the time being to nip in the Bud.
In addition, an IPO offers a enormous range for the company Ripple, and thus at the same time for XRP. Many investors would not come only with Ripple for the first Time in contact, but also with XRP. This could increase the demand for XRP, and lead to a long-term rise in price.
The extra money could be used Ripple for the further Expansion of the XRP payment corridors and, therefore, the commercial Use of XRP as a bridge currency increase. In addition, the money could be invested in other Use Cases, and Marketing of XRP.
All in All, I guess an IPO of the Ripple is positive for the XRP course. Such as the impact on XRP price will actually be when the company officially announces an IPO, and this performs, I can’t guess at this point.

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About the author

Eve Manning

Eve Manning

A native Texan, Eve first started out as a Finance Analyst and later realized that her true passion was not in trading but in writing. She leverages her experience in the Finance industry to analyse and write in-depth news articles covering the Cryptocurrencies, Economy & Finance industries.