It has been a long and arduous journey for Ripple. After emerging from a multiyear battle with the US Securities and Exchange Commission, the blockchain-based payments and infrastructure company is pressing ahead with broad ambitions to unify custody, treasury and prime-brokerage services, each underpinned by blockchain technology and stablecoins.
Despite the bruising legal fight and the reputational damage that came with it, Ripple has still managed to win over some of Wall Street’s biggest players.
This week’s Crypto Biz looks at how Ripple secured a striking $40 billion valuation, and why some of its backers are quietly placing bets on an XRP (XRP) surge.
Elsewhere, WisdomTree rolled out a new options-income strategy through a tokenized fund, Bitwise shifted 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 valuation of $40 billion, attracting investors including affiliates of Citadel Securities, Fortress Investment Group and funds tied to Brevan Howard, Pantera Capital and Galaxy Digital. New reporting now sheds light on how the deal came together.
According to Bloomberg, Ripple secured commitments by offering investors substantial downside protection. The terms allowed participating funds to sell their shares back to Ripple after three or four years for a guaranteed annualized return of 10%. Ripple also retained the right to repurchase those shares during the same window, at an annualized return of 25% for investors.
Ripple has since broadened its strategy, pushing deeper into the stablecoin market and pursuing acquisitions in brokerage and treasury management. Still, sources told Bloomberg that some backers were motivated not only by the company’s expansion plans but also by expectations for the future performance of XRP.
WisdomTree launches tokenized fund targeting options-income strategy
Asset manager WisdomTree is bringing a complex options strategy onchain with a new tokenized fund designed to track the price and yield performance of the Volos US Large Cap Target 2.5% PutWrite Index. The fund, called the WisdomTree Equity Premium Income Digital Fund, is now available under the token ticker EPXC and the fund ticker WTPIX.
The Volos benchmark is modeled on a “put-writing” strategy, in which the index sells cash-secured put options to generate income. Instead of writing options directly on the S&P 500, the strategy uses contracts tied to the SPDR S&P 500 ETF Trust (SPY), allowing it to collect option premiums as the seller.
The launch marks another step in the convergence of traditional finance and blockchain, giving volatility-wary investors a way 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) transitioned from the over-the-counter market to NYSE Arca, broadening its visibility and opening the door to greater institutional participation. The fund is now available as an exchange-traded product.
BITW provides diversified exposure to the 10 largest crypto assets by market capitalization, including Bitcoin (BTC), Ether (ETH), Solana (SOL) and XRP.
“Most investors we meet are convinced crypto is here to stay, but they don’t know who the winners will be or how many will succeed,” said Matt Hougan, Bitwise’s chief investment officer. “The index approach is a way for people to invest in the thesis without having to predict the future.”
An NYSE Arca listing may help BITW attract investors who are hesitant to buy 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 notable step in the growing institutional push into digital assets. The listing follows the company’s merger with Cantor Equity Partners.
The company, now trading under the ticker XXI, holds more than 43,000 BTC, valued at nearly $4 billion.
“Bitcoin is honest money. That’s why people choose it, and that’s why we built Twenty One on top of it,” CEO Jack Mallers said as the company went public.
Backed by Cantor Fitzgerald, Tether, Bitfinex and SoftBank, Twenty One Capital has exceeded its Bitcoin accumulation targets after a series of large purchases throughout the year.
Crypto Biz is your weekly pulse on the business behind blockchain and crypto, delivered directly to your inbox every Thursday.
