- A Pitchbook algorithm predicts a 98% success probability for a Ripple IPO.
- The IPO speculation resurfaces following Ripple’s recent legal win against the SEC.
In the wake of Ripple Labs’ momentous legal victory against the Securities and Exchange Commission (SEC), industry analysts and investors are keenly focusing on the firm’s future prospects, particularly the likelihood of an Initial Public Offering (IPO). This heightened interest comes at a critical juncture, as the cryptocurrency market grapples with bearish trends, spurred by SEC delays in Bitcoin Spot ETF approvals. The pivotal question is: can a successful Ripple IPO reinvigorate the XRP token, potentially elevating its price back to the $1 mark?
The Nuts and Bolts Behind the 98% Probability
Venture capital analytics firm Pitchbook recently caught the market’s attention with its proprietary AI-driven algorithm that estimates the probability of companies successfully going public. The algorithm factors in various elements like fundraising frequency, patent holdings, workforce size, and financial maturity.
Linda P. Jones’ tweet highlights that Pitchbook’s algorithm, after analyzing a variety of factors like fundraising frequency, number of patents, and financial maturity among others, predicts a 98% probability of Ripple successfully going public through an IPO or merger and acquisition, although it doesn’t specify a timeframe for this event.
Pitchbook has an algorithm that analyzed 64,000 past successful exits of private companies by IPO or merger & acquisition (M&A) since 2018. They analyzed data such as frequency and size of fundraising rounds, number of patents, number of employees, number of acquisitions made by… pic.twitter.com/DhYtlsC9G7
— Linda P. Jones (@LindaPJones) August 30, 2023
The IPO Buzz Post-SEC Lawsuit
The IPO discussions are not new for Ripple. CEO Brad Garlinghouse stated back in 2022 that an IPO could be in the cards once they cleared the SEC legal hurdles. Flash forward to today, and the SEC lawsuit win has thrown more wood onto the speculative fires. Ripple even had a private ‘road show’ in April 2023, intended to measure interest among potential investors for an IPO.
Ripple’s Valuation and Trading Scenarios
After a Series C funding round in 2019, Ripple’s valuation stood at $15 billion. While there’s no confirmed listing yet, future trading of its shares could follow standard procedures for any other publicly-traded stock. However, investors should be cautious as share prices can be highly volatile immediately after an IPO.
A Closer Look at Ripple’s Operations
Ripple serves as more than just the XRP token; it operates RippleNet, a digital payment network built on blockchain technology. The recent court ruling may not be the end of the SEC saga, as appeals could still happen. The XRP token saw a short-lived 76% price surge following the court’s favorable ruling but soon retreated.
How Ripple Generates Revenue
Ripple has a diversified income portfolio, including profits from the sale of its XRP tokens, transaction fees via RippleNet, and interest fees on loans. The company has also acquired other businesses like Tranglo, adding to its revenue streams.
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