VivoPower is set to purchase $100 million in Ripple Labs shares, significantly boosting its XRP-focused digital asset strategy and causing shares to surge over 32%.
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VivoPower’s shares jumped 32.12% to $5.10 following the announcement.
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The acquisition is pending approval from Ripple’s management.
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VivoPower aims to optimize yield while minimizing XRP acquisition costs.
VivoPower’s recent $100 million investment in Ripple shares has led to a significant surge in its stock price, marking a strategic move in the crypto market.
VivoPower’s Strategic Move into Ripple Shares
VivoPower International PLC, a Nasdaq-listed solar power company, announced a plan to purchase $100 million worth of privately held Ripple Labs shares. This decision has led to a remarkable 32.12% increase in VivoPower’s shares, reaching $5.10. The acquisition, which follows two months of due diligence, is pending approval from Ripple’s executive management.
How VivoPower Plans to Optimize Its XRP Holdings
Kevin Chin, executive chairman and CEO of VivoPower, stated, “Our portfolio construction strategy is to buy a combination of Ripple shares and XRP tokens. This will allow us to optimize for yield maximization while also minimizing the weighted average cost of XRP acquired.” This dual approach positions VivoPower as the first publicly listed US firm to provide investors with exposure to both Ripple equity and XRP.
Custody and Management of Ripple Shares
To effectively manage its Ripple share strategy, VivoPower will collaborate with BitGo for custody services and Nasdaq Private Market, Ripple’s preferred partner for private share transactions. An independent auditor will review VivoPower’s Ripple holdings on a quarterly basis, ensuring transparency and accountability.
Ripple’s Market Position and XRP Holdings
Ripple has created a total of 100 billion XRP tokens, burning approximately 14 million to date. The company currently holds around 41 billion XRP, primarily in escrow. In addition to XRP, Ripple operates the RLUSD stablecoin and provides various digital asset services.
Institutional Custody Services for XRP in South Korea
In a related development, South Korean crypto custodian BDACS has launched regulated custody services for XRP, leveraging Ripple Custody to offer secure storage and management for institutions. This move follows Ripple’s partnership with BDACS earlier this year to support institutional custody for XRP and RLUSD.
Conclusion
VivoPower’s strategic investment in Ripple shares marks a significant development in the crypto landscape, offering a unique opportunity for investors. With an innovative approach to asset management and a focus on yield optimization, VivoPower is poised to enhance its market position while providing substantial value to shareholders.
Frequently Asked Questions
What are the benefits of VivoPower’s investment in Ripple?
VivoPower’s investment allows it to diversify its asset portfolio while providing exposure to the growing market of digital assets, particularly XRP.
How does Ripple’s custody service work?
Ripple’s custody service, offered through partnerships like BDACS, provides secure storage and management capabilities for institutional investors.
Key Takeaways
- Investment Strategy: VivoPower’s $100 million investment in Ripple shares enhances its digital asset strategy.
- Market Impact: The announcement led to a 32% surge in VivoPower’s stock price.
- Innovative Management: Collaboration with BitGo and Nasdaq ensures secure management of Ripple shares.
