Ripple is pushing to acquire Circle, the publisher of USDC Stablecoin, with new proposed offers reaching up to $11 billion.
However, the community is concerned that the deal could lead to negative outcomes, from market panic to undermining the role of XRP. So why is Ripple determined to buy a circle, and what does this mean for the crypto market?
Why does Ripple win a circle?
Ripple, the company behind XRP, has long positioned it as a cross-border payment solution with the aim of replacing traditional systems like Swift. However, the rapid rise of stubcoins, including USDC, and their promising future, shatters the role of XRP.
“They are about to buy a circle because Stablecoins are supposed to make UseCase XRP useless at all,” commented X-user R89Capital.
The user also suggests that Ripple’s willingness to spend heavily on the circle is due to “dumping billions of dollars worth of XRP at retail stores.” This view has attracted agreements from many other X users.
“Crypto didn’t have any larger glyfts than Ripple. It’s one of the biggest scams in financial history,” added R89Capital.
The argument that USDC can render XRP deprecation is based on the price stability of Stablecoins and the extensive adoption by traditional financial institutions (TRADFI). Its market capitalization is $61 billion, and USDC is not just a stubcoin, but a bridge between traditional finance and blockchain supported by major organizations.
In this regard, winning circles for up to $11 billion will allow Ripple to take advantage of USDC’s position rather than competing with USDC. Additionally, owning USDC could strengthen Ripple’s position in the digital finance field. The company has also recently made many acquisitions. Recently, Ripple has launched its own Stablecoin, RLUSD, with a market capitalization of $310 million, which pales in comparison to USDC.
Cockiring Circle will allow Ripple to integrate USDC into its ecosystem, leveraging its relationship with the circle and its major financial institutions to increase its market share. This move can also reduce Ripple’s dependency on XRP. This faces fierce competition from Stablecoins and other payment solutions.
Profits and risks
However, the crypto community has expressed deep concern about the transaction. X user Gwartygwart likens Ripple’s acquisition of Circle’s “Hooli to Buy Pied Pied Piper,” suggesting potential negative consequences for the television series Silicon Valley.
Meanwhile, X user 0xShual warned that trading could cause “mass panic” in the market as Ripple’s control over USDC could concentrate power and undermine the distributed nature of the Stablecoin ecosystem. When Ripple manages USDC, the community fears that it will put its own interests first, and it poses the transparency and trust that USDC has built.
Despite these concerns, this deal offers a ripple opportunity. If the acquisition is successful, Ripple could become a major player in the Stablecoin market, competing with rivals like Tether (USDT).
However, due to Circle’s initial rejection and pressure from competitors like Coinbase, Ripple faces major challenges in completing the transaction. In the current crypto market, the acquisition of Ripple-Circle is a strategic move and a test of Ripple’s ambitions to reshape the future of digital finance.
