Amid a challenging period for the XRP price, which has seen a decline of 24% over the last two weeks, Ripple Labs, the blockchain payment company, has announced plans to raise at least $1 billion for a major XRP purchase, intended for the establishment of a new digital asset treasury (DAT).
Ripple Plans Largest Fundraising Effort
According to sources cited by Bloomberg, the capital will be managed within this new treasury, and Ripple plans to utilize a special purpose acquisition company (SPAC) to facilitate the fundraising. Additionally, the company will contribute some of its own XRP holdings to bolster the effort.
However, investor sentiment towards DATs has become increasingly cautious, as evidenced by the sharp declines in shares of major crypto firms, including Michael Saylor’s Strategy (previously MicroStrategy) and Japan’s Metaplanet.
Despite this skepticism, Ripple Labs is pressing forward with its ambitious fundraising plans, which, if successful, would mark the largest effort focused specifically on XRP. Currently, XRP stands as the fifth-largest cryptocurrency, boasting a market capitalization of $138 billion.
In a related strategic move, Ripple announced on Thursday the acquisition of treasury management software provider GTreasury for $1 billion. This acquisition is seen as a way to strengthen its connections with corporate finance leaders and treasurers seeking access to tokenized deposits, stablecoins, and other digital assets.
As of July 31, Ripple held 4.74 billion XRP tokens in its wallets, valued at approximately $11 billion at current market prices. Additionally, another 35.9 billion XRP coins are under escrow lockups, scheduled for monthly releases.
Potential 350% Rally Ahead For XRP
This potential catalyst could signal a recovery phase for XRP. Market expert Dark Defender noted on social media platform X (formerly Twitter) that the correction had completed at the $2.22 level, which was established in August, suggesting that the “Journey Towards $10 Resumes.”
Despite the current market panic, the expert reassures investors that the altcoin is entering a new recovery phase, with the $2.22 mark representing a crucial threshold for the short-term price action.
According to the expert’s analysis, this scenario could lead to a significant rally of 340% in the coming months, on top of the already impressive 320% gains recorded year-to-date.
As of this writing, XRP is trading at around $2.26, resting on a critical support level as October draws to a close. Should this level falter, and if the $2.4 support fails to prevent further declines, XRP could retrace back toward the $1.2 level, the price reached during the market crash on October 10.
Featured image from DALL-E, chart from TradingView.com
