Ripple CTO Debunks 10 Billion XRP Buyback Rumors

Ripple CTO Debunks 10 Billion XRP Buyback Rumors

UTC by Chimamanda U. Martha · 3 min read
Ripple CTO Debunks 10 Billion XRP Buyback Rumors
Photo: Ripple Labs

Ripple CTO addressed the matter, labeling the rumors as false and casting doubt on the credibility of the news article due to the absence of an official source.

Ripple Chief Technology Officer (CTO) David Schwartz has clarified the rumors regarding the company’s potential buyback of 10 billion XRP tokens. In one of his tweet replies on June 25, Schwartz said no plans were in motion for the buyback claims.

The rumors originated from a report published by CryptoAlert over the weekend, claiming that Ripple, a San Francisco-based blockchain payments firm, intended to repurchase 10 billion of XRP from the market, a whopping 10% of the token’s circulating supply. The news sparked excitement and curiosity among the crypto community, as a buyback of such magnitude could have significant implications for the price and overall sentiment surrounding XRP.

Taking to Twitter, Ripple CTO addressed the matter, labeling the rumors as false and casting doubt on the credibility of the news article due to the absence of an official source. Schwartz emphasized that while Ripple occasionally purchases XRP, he personally has no knowledge or specific details regarding any potential buyback in relation to the claim.

Investors May Be Unwilling to Lend Ripple Funds to Buyback XRP

Notably, John E. Deaton, a pro-crypto lawyer known for supporting XRP, expressed skepticism about the alleged buyback. Deaton stated that he would not believe Ripple’s involvement in such a significant buyback until he heard it directly from the company.

Adding to the skepticism, another prominent lawyer in the industry, Bill Morgan, raised concerns about the financial feasibility of Ripple acquiring 10 billion XRP, currently valued at $5 billion.

Morgan pointed to the ongoing legal battle between Ripple and the United States financial regulator, the Securities and Exchange Commission (SEC), as a major obstacle, noting that investors would unlikely lend funds to a company seeking to buy back a token under such legal scrutiny.

He further suggested that Ripple may need to explore alternative funding avenues, such as an initial public offering (IPO), to secure the necessary capital for such a massive buyback.

David Schwartz Calls Vallee’s Proposed Buyback Theory Scam

Earlier in February, before the recent rumors about a potential buyback, the Ripple CTO referred to a buyback theory instigated by Jimmy Vallee, the Managing Director of Valhill Capital, in 2021 as a scam and awful.

Valle revisited the theory in a recent interview, maintaining his stance that XRP has the potential to become the world’s reserve currency, urging the US government to make the dream a reality and buy up the entire token’s circulating supply from the market.

Responding to him, Schwartz said the theory looked like a scam.

“I haven’t looked at it very closely. But what I have seen looks an awful lot like a scam to me. If we’ve learned anything from 2012 and 2022, it’s that anyone promising high returns with low risk is almost certainly going to rob you,” Schwartz said.

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