Ripple denies rumors of acquiring Circle for $5 billion

Rumors and facts

In late April, Bloomberg reported that Ripple had offered to buy Circle for $4-5 billion, but was rejected because Circle deemed the price too low. Later, some sources spread information that Ripple increased the offer to $20 billion, causing the price of XRP to increase by more than 10%. However, at the XRP conference in Las Vegas, Garlinghouse flatly denied: “Ripple has no plans to buy Circle. We are focused on developing RLUSD and other strategies.”

Circle, which is preparing for an IPO with a target valuation of $5-6 billion, also did not comment on the rumor. Circle's USDC currently has a market capitalization of $61.5 billion, far exceeding Ripple's RLUSD ($310 million).

Ripple's Strategy in the Stablecoin Market

Ripple is clearly looking to solidify its position in the stablecoin space, an increasingly important part of the decentralized finance (DeFi) and global payments ecosystem.

The launch of RLUSD is part of this strategy, with the goal of integrating the stablecoin into Ripple’s payment system, providing faster and cheaper cross-border transactions. However, with a market capitalization of only $310 million, RLUSD is struggling to compete with USDC and USDT (capitalization of $153 billion).

Why is this rumor important?

• Stablecoin competition: Ripple is trying to make RLUSD compete with USDC and USDT ($153 billion market cap). Buying Circle would help Ripple quickly gain market share, but Garlinghouse seems to want to build the ecosystem himself.

• Market Sentiment: Rumors have caused XRP prices to fluctuate wildly, showing the sensitivity of the cryptocurrency market to unverified information.

• Circle's Strategy: Rejecting offers (if any) and focusing on an IPO shows that Circle is confident in its value, especially with a big partner like Coinbase.

Impact on XRP token

Ripple’s denial calms speculation, but also raises questions about the future of RLUSD. With a small market cap, RLUSD will need time and significant investment to compete. Meanwhile, Circle continues to strengthen its position with USDC, especially as the GENIUS Act could facilitate stablecoins in the US.

XRP prices have dipped slightly following Garlinghouse’s statement, but are still up 2% over the past 24 hours, trading around $2.50. Investors should be wary of rumors amid the volatile crypto market.

Conclude

Ripple’s denial of the Circle acquisition suggests that the company is betting on a long-term strategy with RLUSD, rather than chasing big deals. For Circle, the IPO plan remains the focus. Both companies are reshaping the stablecoin market, but only time will tell who will come out on top.

Once again we give our opinion on potential projects in the crypto market. This is not investment advice, consider your portfolio. Disclaimer: The views expressed in this article are solely those of the author and do not represent the platform in any way. This article is not intended to be a guide to making investment decisions.

Compiled and analyzed by HCCVenture

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