Amid a challenging period for the XRP price, which has fallen 24% in the past two weeks, Ripple Labs, the blockchain payments company, has announced plans to raise at least $1 billion for a major XRP purchase aimed at establishing a new digital asset treasury (DAT).
Ripple plans largest fundraising effort
According to sources According to Bloomberg, the capital will be managed within this new treasury, and Ripple plans to use a special purpose acquisition company (SPAC) to facilitate the fundraising. Additionally, the company will contribute some of its own XRP stakes to bolster the efforts.
However, investor sentiment toward DATs has become increasingly cautious, as evidenced by sharp declines in shares of major crypto companies, including Michael Saylor’s Strategy (formerly MicroStrategy) and Japan’s Metaplanet.
Related reading
Despite this skepticism, Ripple Labs continues with its ambitious goals fundraising planswhich, if successful, would mark the largest effort specifically focused on XRP. Currently, XRP is the fifth largest cryptocurrency, with a market capitalization of $138 billion.
In a related strategic move, Ripple announced Thursday the acquisition of treasury management software provider GTreasury for $1 billion. This acquisition is seen as a way to strengthen ties with corporate finance leaders and treasurers seeking access to tokenized deposits, stablecoins and other digital assets.
As of July 31, Ripple had 4.74 billion XRP tokens in its portfolios, worth approximately $11 billion at current market prices. Moreover, there are another 35.9 billion XRP coins underneath escrow holdsscheduled for monthly releases.
Potential 350% increase for XRP
This potential catalyst could signal a recovery phase for XRP. Market expert Dark Defender noted on social media platform
Despite the current panic in the market, the expert is reassures investors that the altcoin is entering a new recovery phase, with the $2.22 mark representing a crucial threshold for near-term price action.
Related reading
According to the expert’s analysis, this scenario could lead to a significant increase of 340% in the coming months, on top of the already impressive 320% gain made so far this year.
At the time of writing, XRP is trading around $2.26, resting at a critical support level as October comes to a close. Should this level falter, and if the $2.4 support fails to prevent further declines, XRP could return to the $1.2 level, the price reached during the October 10 market crash.
Featured image of DALL-E, chart from TradingView.com