April 9, 2019, | AtoZ Markets - A piece of research, that has been recently conducted by a private exchange, says that Ripple IPO might prove unsuccessful.
The researchers see as well that If Ripple was fostered by a larger institution, it would have rated better.
The exchange, which trades in Ripple equity, raised concerns with regard the long-term viability of the remittance and settlements solution provider.
The argument in the research paper pivoted around whether a Ripple IPO would be an attractive investment, as even with cryptocurrencies like XRP having the ability to play as a settlements solution, the competition in this regard would still stand as a barrier.
XRP enjoys a significant market opportunity
The paper read as well that “Payments is a crowded landscape with big banks, processing firms and now Blockchain based payment startups chasing the same market, (….) Ripple enjoys a significant market opportunity and is uniquely positioned to grow given its partnerships with major financial institutions around the world,”
The research also reached that RippleNet, the significant Ripple product, is a “safe, efficient and reliable alternative to existing payment methods,”
Expectations are that firms like Ripple, are “unlikely to be profitable anytime soon,”, the thing that is attributed to the risk of losing out to well-heeled incumbents.
It is worth mentioning that the researching side is SharesPost, which is an online marketplace that allows accredited or institutional investors to trade pre-IPO stock, including equity in Ripple Labs.
Ripple IPO could become highly lucrative
Other excerpts from the research also looked at seven comparable public offerings from companies like Mastercard, Visa, PayPal, and Western Union.
That showed, on average, equity value increased tenfold above the initial price following a public offering, which again reinforces the idea that says if financial institutions adopt RippleNet, the Ripple IPO could become highly lucrative.
Three years ago, Ripple CEO Brad Garlinghouse told CNBC, that although the company was not yet ready for an IPO, it would “make sense” at some point in the future.
In a connected news, AtoZ Markets reported on April 8th, that Tata Consultancy Services (TCS) unveiled a new method to connect banks and financial institutions to Ripple’s suite of cross-border payments technology.
The company announced in a statement that its Quartz blockchain solution now works with RippleNet.
TCS did not clarify though which bundle of cross-border software solutions its Quartz platform uses.