Ripple Gives Investors 10% Return Guarantees in $500M Sale, Bloomberg Reports
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Investors received rights to sell shares back to Ripple after three or four years at guaranteed 10% annual returns unless an initial public offering occurs first. The company retained buyback options at matching intervals but would owe 25% annualized returns if it exercised those rights early. Liquidation clauses prioritize new investors over existing shareholders in acquisition or bankruptcy scenarios. The structure would require Ripple to pay approximately $732 million to repurchase the entire stake after four years at the minimum return rate. Marshall Wace, Brevan Howard, Galaxy Digital, and Pantera Capital participated in the round, valuing the company at $40 billion. The investors negotiated downside protection uncommon in cryptocurrency investments, securing asymmetric risk-reward profiles through contractual mechanisms. Company disclosures from July showed $124 billion in XRP holdings, with substantial portions locked in escrow or released on predetermined schedules. The token has dropped over 40% from peak values in mid-July and declined roughly 16% since late October when the funding round was announced. Similar protection structures appeared in Brevan Howard's Berachain investment earlier this year. That deal included a $25 million refund mechanism providing recourse under specified conditions, demonstrating traditional finance appetite for cryptocurrency exposure...
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