- Ripple, in its internal communications, considered the possibility of XRP buybacks to bolster its price, according to newly disclosed documents.
- Although the company denied intending to attract speculative investors, an email from Ripple’s general manager, Monica Long, contradicts this stance.
The unfolding legal standoff between Ripple Labs and the US Securities and Exchange Commission (SEC) has led to the release of a trove of internal communications from the former. Amid these documents, it has come to light that Ripple had, at one point, entertained the idea of buying back XRP tokens as a measure to support its price.
Recent conjecture surrounding a possible buyback of 10 billion XRP tokens by Ripple Labs made headlines. However, these rumors were swiftly put to rest by Ripple’s Chief Technology Officer, David Schwartz. His tweet clarified that while Ripple does occasionally purchase XRP, there was no specific plan or credible source to affirm the speculated buyback.
Yup agree. @JoelKatz any validity to this?
— M31💫 (@Supa_Zo005) June 25, 2023
Nevertheless, the disclosed emails and documents reveal that Ripple had indeed toyed with the notion of an XRP buyback as a price stabilization measure, even shortly before the SEC lawsuit in June 2020. Breanne Madigan, then the VP Head of Global Institutions Markets, shared a presentation which discussed the impact of XRP-O (On-Demand Liquidity) supply on the token’s price. The document indicates Ripple’s recognition that sales via XRP-O were exerting negative pressure on the XRP price, and that buybacks could alleviate this.
The document also outlines five potential buyback strategies, each followed by a trial period of one to three months. These ranged from repurchasing XRP via market makers on multiple exchanges, directly from market makers, to even curtailing XRP-O volumes.
However, these buyback plans remain purely speculative, especially given the onset of the SEC lawsuit. The Ripple-SEC saga also brings to light another critical point. While Ripple has consistently denied marketing XRP to speculative investors, an email from Monica Long, Ripple’s current general manager, contradicts this claim. In the email, Long emphasizes the need to focus their efforts on attracting speculators, a statement which could potentially add a new twist to the legal dispute.
As these revelations add layers of complexity to the ongoing case, XRP’s price remains under the $0.50 resistance level. It seems that Ripple’s ongoing legal battles and internal strategies will continue to influence XRP’s market performance.