Details Of Ripple-Evernorth Deal Remain Blurry: How Much XRP Is Really Being Bought?

Momentum around XRP picked up again this week after Ripple-backed company Evernorth revealed plans to go public via a SPAC and use the proceeds to build what it calls The world’s leading institutional XRP treasury. However, there have been questions about how much altcoin the company is actually purchasing.

Evernorth’s upcoming listing on the Nasdaq through merger with Armada Acquisition Corp. II is It is expected to raise more than $1 billionbut there are questions about how much capital will be allocated to open market purchases of tokens versus in-kind contributions.

Confusion about Evernorth’s XRP structure

A post on social media platform X from an account called ScamDetective added to the uncertainty. the The user claimed so “Most of Evernorth’s XRP will not be purchased” and that “only 14% of their total holdings will be purchased at closing,” claiming that the remainder will be committed to the equity-in-kind fund.

This means that only about 14% of the proposed $1 billion XRP treasury will be purchased from the open market. The rest will be acquired in the form of XRP by other parties. This explanation quickly spread among XRP holders who feared that Evernorth’s impact on the market would be much less significant than originally thought.

However, attorney Bill Morgan Quickly respond to this claimExplaining that the only one Confirmed in-kind contribution To Evernorth, 50 million of the altcoin was transferred by Ripple co-founder Chris Larsen. However, Larsen’s in-kind contribution is separate from the cash Evernorth is trying to raise for open market purchases.

Morgan explained that SBI Holdings’ investment of $200 million was all cash and would be used specifically for open market purchases once the deal closed. This makes the guaranteed minimum 20% of the treasury to be purchased on the open market, which is more than the 14% figure indicated by ScamDetective.

To reinforce his point, Morgan shared the official A document from SBI Holdings outlining the investment structure. The document explains that the proceeds are primarily for acquisitions of XRP from the open market, which contradicts the suggestion that the majority of the token in the treasury would be from token liabilities.

The real numbers behind the headlines

Evernorth’s merger with Armada plans to raise more than $1 billion in gross proceeds. Assuming that the majority of this money is actually used for open market purchases, Accumulation volume It will be huge.

The $1 billion allocation to the treasury would translate into approximately 415 million to 420 million XRP tokens based on the current trading range. However, until SEC filings and financial statements are released after the merger, the exact amount of altcoin Evernorth will purchase is only an estimate.

The Treasury will serve as another positive institutional milestone for the altcoin. At the time of writing, the price of the token is trading at $2.41.

Featured image from Peakpx, chart from Tradingview.com

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