XRP Ripple Acquisition of Circle Sparks Controversy

XRP Ripple’s potential acquisition of Circle has ignited significant debate across the crypto industry, with some experts warning it could bring disruptive consequences to the broader digital asset space. The prominent legal voice behind these remarks, Gabriel Shapiro, has raised the alarm over what he describes as a possible “crypto apocalypse.”

Shapiro, the founder of MetaLeX Labs, believes that if Ripple successfully acquires Circle, it may lead to a dangerous level of dominance for Ripple within the cryptocurrency landscape. In his analysis, he questions whether such a move could pass antitrust evaluations from regulatory authorities such as the Department of Justice (DoJ) and the Federal Trade Commission (FTC).

Regulators would closely examine whether the acquisition grants Ripple excessive control over core crypto infrastructure, potentially resulting in monopolistic behaviors. Shapiro argues that the consequences of such dominance could be severe, disrupting competition and stifling innovation in the digital finance ecosystem.

He emphasized the risks by stating that making Ripple the leading issuer of digital assets across various blockchains would not only limit fair market practices but also introduce significant imbalances. Shapiro reinforced these concerns by referencing the company’s past tactics, including alleged efforts to spread fear, uncertainty, and doubt (FUD) about competing projects.

One specific example he cited was Ripple co-founder Chris Larsen’s 2022 partnership with Greenpeace. The campaign they launched targeted Bitcoin’s energy-intensive proof-of-work protocol, which experts viewed as a strategic move to redirect public and institutional sentiment.

Shapiro also brought up the significance of the Revlon doctrine, a legal principle obligating corporate boards to prioritize securing the best possible deal for shareholders. In this context, he argues the board at Circle must carefully consider the potential regulatory backlash and antitrust risks before proceeding with any acquisition deal involving Ripple.

“If a binding agreement is finalized,” Shapiro warned, “we’ll be knocking on the doors of the DoJ and FTC,” highlighting Ripple’s controversial history involving aggressive campaigns against other major crypto assets like Bitcoin and Ethereum.

Currently, Circle — the issuer of USDC, one of the largest stablecoins in the market — is reportedly being courted not just by Ripple but also by Coinbase. The competition between these two major players has intensified in recent months.

While Ripple is leveraging its significant XRP holdings as leverage in acquisition discussions, earlier reports indicate that Ripple’s $5 billion bid for Circle had been declined. The offer was considered undervalued according to internal insiders, leaving the door open for continued negotiations or rival bidding.

Coinbase appears better positioned at the moment, but Ripple’s vast crypto reserves give it strong acquisitive potential. However, the regulatory landscape remains a significant hurdle that could make or break such a transformative transaction.

The conversation around Ripple’s ambitions goes beyond mere business strategy — it touches on the long-term structural integrity of the crypto ecosystem. Shapiro’s stern outlook underscores the stakes involved, especially as power becomes increasingly concentrated among a few dominant players.

As the scenario unfolds, market watchers are closely monitoring how Ripple navigates this high-stakes opportunity amidst public skepticism and potential legal scrutiny. The result could shape the future of stablecoin issuance, blockchain influence, and the balance of power within the crypto sphere.

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For now, Ripple’s role in reshaping the financial layer of blockchain continues to expand, but not without drawing critical attention to its growing ambitions.