XRP-Backed Ripple Considered $5B Acquisition of Circle

XRP was in the spotlight again following a recent report revealing that Ripple, the company behind the XRP cryptocurrency, explored a possible $5 billion acquisition of stablecoin issuer Circle. This potential deal, which would have marked a major consolidation within the crypto space, was ultimately turned down by Circle in favor of sticking with its plans to go public.

According to a Fortune report released on Monday, Circle engaged in preliminary discussions with both Ripple and the major U.S. exchange Coinbase regarding a potential sale. The stablecoin issuer was reportedly seeking a buyout offer of at least $5 billion, aligning with valuations previously provided by major investment banks JPMorgan and Citi. These firms have been advising the company on its current initial public offering (IPO) plans.

Circle, headquartered in New York, is the creator of USDC, the second-largest stablecoin in the market. While Coinbase already holds a stake in Circle and the two parties jointly benefit from the interest earned on USDC reserves, Ripple had emerged as an unexpected suitor in these acquisition talks. With the launch of its own stablecoin RLUSD earlier this year, Ripple has been expanding its presence in the digital asset space.

Despite Ripple’s strategic interest, their reported offer of $4 to $5 billion failed to secure a deal. According to a previous Bloomberg report, Circle declined Ripple’s bid, opting to continue its independent journey as a public company. The company released a statement reiterating its stance: it is “not for sale” and remains focused on its IPO roadmap.

This decision comes on the heels of Circle’s recent filing for an IPO last month. The company has ambitions to cement its position in the financial markets after its previous attempt to go public through a SPAC deal in 2021 was called off.

The potential acquisition could have significantly recalibrated the stablecoin and blockchain landscape. XRP’s Ripple would have gained a more dominant position alongside RLUSD, elevating its competitive standing against the likes of Tether (USDT) and Circle’s USDC in the dollar-pegged digital asset arena.

Meanwhile, Coinbase, another interested party in the deal, continues to deepen its involvement with Circle. The two still share profits derived from USDC reserves, a partnership that has been integral to both companies’ financial trajectories in the stablecoin economy.

Ripple’s interest in Circle reflects a broader ambition to extend its real-world asset and payments infrastructure by leveraging stablecoins as part of its offering. Acquiring Circle, if it had materialized, would have accelerated Ripple’s mission to become a key player in the global digital payment space, with XRP at the center of this evolution.

For now, XRP supporters and crypto investors will be watching Ripple’s next strategic move. While the Circle deal may not have succeeded, it signals that Ripple is actively seeking to expand and diversify its utility beyond cross-border payments, potentially driving renewed interest in its ecosystem.

As Circle remains set on going public, and Ripple continues cultivating its own stablecoin infrastructure, the competitive race in the stablecoin and payments sector is intensifying – with XRP potentially set to benefit from Ripple’s ambitious expansion plans.

Related: Expert Advice: Sell XRP If You’re Confused

For further reading on related developments, check out this analysis: Coinbase Shares Could See $16B of Buying Pressure From S&P 500 Index Inclusion: Bernstein.