- David Schwartz, co-founder of the XRP Ledger and CTO emeritus of Ripple, publicly advised people should not invest in the company.
- He stated that while qualified investors can buy Ripple stock on the secondary market, they “probably shouldn’t.”
- The company’s valuation on the secondary market, around $19 billion, is less than half the $50 billion valuation it claimed in March.
- Many retail investors mistakenly buy XRP as a proxy for Ripple, despite XRP not being a direct equity investment.
David Schwartz, the co-founder of the XRP Ledger and CTO emeritus of Ripple, broadcasted an unusually clear personal investment warning, advising that people should not invest in Ripple. He was responding to members of the crypto community who have long requested public access to Ripple stock. Schwartz said, “If you want direct exposure to Ripple’s success or failure, you can buy Ripple stock on the secondary market if you qualify under US law. But you probably shouldn’t,” according to his post.
Consequently, this guidance comes from a major insider shareholder whose company once held $180 billion worth of XRP. Ripple originally controlled 80% of the XRP supply and has steadily sold its coins over time.
Meanwhile, Ripple stock trades on Forge Global at $116 per share, imputing a $19 billion valuation. Importantly, this secondary market valuation is less than half the $50 billion valuation Ripple itself claimed two months ago.
However, many retail investors mistakenly buy XRP as a proxy bet on Ripple‘s success. The company has never conducted an IPO, and XRP is not a direct equity investment.
Schwartz, who admitted his Ripple equity is now almost all his crypto exposure, co-created the ledger with Arthur Britto in 2012. His view on public investment in the company he helped build certainly carries significant weight.
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