Ripple has faced a long and challenging journey. After a protracted dispute with the US Securities and Exchange Commission, the blockchain-based payments and infrastructure company is moving forward with ambitious plans to integrate custody, treasury, and prime-brokerage services, all supported by blockchain technology and stablecoins.
Despite the intense legal struggles and the reputational impact, Ripple has managed to secure support from several major players on Wall Street.
This week’s Crypto Biz examines how Ripple achieved an impressive $40 billion valuation, and why some of its investors are quietly betting on a rise in XRP (XRP).
In other news, WisdomTree launched a new options-income strategy via a tokenized fund, Bitwise relocated its crypto index fund to the NYSE Arca, and Jack Mallers’ Twenty-First Capital made its public debut on the New York Stock Exchange.
The story behind Ripple’s $40 billion valuation
In November, Ripple raised $500 million at a $40 billion valuation, attracting investors such as affiliates of Citadel Securities, Fortress Investment Group, and funds connected to Brevan Howard, Pantera Capital, and Galaxy Digital. New reports reveal how the deal was structured.
As reported by Bloomberg, Ripple secured commitments by providing investors with significant downside protection. The terms enabled participating funds to sell their shares back to Ripple after three or four years for a guaranteed annualized return of 10%. Ripple also had the right to repurchase those shares during the same period, offering an annualized return of 25% for investors.
Ripple has since expanded its strategy, delving deeper into the stablecoin sector and pursuing acquisitions in brokerage and treasury management. However, sources indicated to Bloomberg that some backers were driven not only by the company’s growth plans but also by expectations for XRP’s future performance.
WisdomTree launches tokenized fund targeting options-income strategy
Asset manager WisdomTree is introducing a sophisticated options strategy onchain through a new tokenized fund aimed at tracking the price and yield performance of the Volos US Large Cap Target 2.5% PutWrite Index. The fund, named the WisdomTree Equity Premium Income Digital Fund, is now accessible under the token ticker EPXC and the fund ticker WTPIX.
The Volos benchmark is based on a “put-writing” strategy, where the index sells cash-secured put options to generate income. Instead of directly writing options on the S&P 500, the strategy utilizes contracts tied to the SPDR S&P 500 ETF Trust (SPY), allowing it to collect premiums as the seller.
This launch signifies another stride in the convergence of traditional finance and blockchain, enabling risk-averse investors to access a put-writing strategy through an onchain fund.
Bitwise’s crypto index fund lists on NYSE Arca
On Dec. 10, Bitwise Asset Management’s 10 Crypto Index Fund (BITW) shifted from the over-the-counter market to NYSE Arca, increasing its visibility and enabling greater institutional engagement. The fund is now offered as an exchange-traded product.
BITW offers diversified exposure to the 10 largest crypto assets by market capitalization, which include Bitcoin (BTC), Ether (ETH), Solana (SOL), and XRP.
“The majority of investors we encounter believe crypto is here to stay, yet they are uncertain about the market leaders and how many will thrive,” stated Matt Hougan, Bitwise’s chief investment officer. “The index approach allows individuals to invest in the premise without needing to forecast the future.”
An NYSE Arca listing may assist BITW in attracting investors who are reluctant to purchase crypto directly through exchanges.
Twenty One Capital opens with a strong public debut
Bitcoin treasury company Twenty One Capital began trading on the New York Stock Exchange on Tuesday, marking a significant step in the growing institutional interest in digital assets. This listing follows the company’s merger with Cantor Equity Partners.
Now trading under the ticker XXI, the company holds over 43,000 BTC, valued at approximately $4 billion.
“Bitcoin represents honest money. That’s why people opt for it, and that’s why we built Twenty One based on it,” CEO Jack Mallers stated as the company went public.
Supported by Cantor Fitzgerald, Tether, Bitfinex, and SoftBank, Twenty One Capital has surpassed its Bitcoin accumulation goals following a series of large purchases throughout the year.
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