- Ripple plans to buy back up to $750 million in shares from investors and employees by the end of next month, insiders have revealed.
- The buybacks would value the company at $50 billion, and come six months after a similar plan to buy back $1 billion in shares from employees failed.
Ripple is plotting a share buyback that would value the company at $50 billion despite the price of XRP dropping over 60% in the past eight months.
The California company intends to buy back shares worth $750 million by the end of April from both investors and its employees, sources within the company told Bloomberg on condition of anonymity as the company has not made the matter public yet.
At $50 billion, the company would be one of the most valuable startups in the crypto ecosystem, with its rise to the top seemingly unaffected by this year’s market crash that has chipped $850 billion from the combined crypto market cap.
Ripple’s rise goes beyond crypto. As CNF reported last month, the company was ranked among the top 10 most valuable private companies globally. The company was on the same list as some of the world’s most renowned companies, from Stripe and Revolut in fintech to Anthropic and OpenAI in AI.
It’s not the first time Ripple has attempted a share buyback. In October last year, it launched a $1 billion buyback program, but a report from The Information revealed that its employees were hesitant to sell their shares. A lot has changed since then in the company’s favor. This includes a drastic dip in crypto prices; XRP started October trading above $3, but has since lost over 50% of its value. The company’s valuation has also shot up since then, raising the value of the employees’ shares.
Ripple’s Rise Defies XRP Price Drop
Ripple’s share buyback program is backed by its $500 million fundraising round in December last year that valued the company at $40 billion. The round was led by titans like the Fortress Investment Group and Citadel Securities. It was revealed that the investors had included clauses in their deals that included the right to sell shares back to the company at a guaranteed return.
Investors in the raise also reportedly concluded that 90% of the company’s value was derived from XRP. However, Ripple has been keen to diversify beyond XRP, and in the past year, it has splashed over $2.5 billion on acquisitions. Its biggest investment was in Hidden Road, a prime brokerage it acquired for $1.25 billion. It has since converted Hidden Road to Ripple Prime, and as we reported, it has processed over $3 trillion and is now recognized by the DTCC.
GTreasury was the other major investment, with Ripple splashing $1 billion on the treasury software provider. It has also acquired stablecoin infrastructure firm Rails and Australian fintech BC Payments.
XRP trades at $1.37, dipping slightly over the past day to bring its losses in the past week to 2.75%. After recovering from a weekly low of $1.339 to trade above $1.43, it lost momentum, with trading volume also dipping as the broader market faces increasing uncertainty.
