XRP Poised for Potential Supply Shock and Billions in Inflows Following Evernorth Merger
XRP Poised for Potential Supply Shock and Billions in Inflows Following Evernorth Merger
Evernorth, a treasury firm backed by Ripple, is merging with Armada Acquisition Corp II and plans to list under the XRPN ticker, aiming to establish a substantial $1 billion XRP treasury. While initial contributions to this treasury were in XRP, analysts like Vincent Van Code anticipate a significant 'supply shock' if the billions in new cash raised from the upcoming IPO are subsequently used for open market purchases of XRP. This development, seen as strongly bullish by market commentators, further reinforces XRP's evolving narrative as a key treasury asset within the XRPL ecosystem, a sentiment echoed by Ripple's CTO, David Schwartz.
Evernorth Merger and XRP Treasury Plans
Ripple-backed treasury firm, Evernorth, has announced its merger with Armada Acquisition Corp II, with plans to list under the XRPN ticker. The core objective of this SPAC deal is to raise $1 billion to establish a large XRP treasury. Initial contributions to this project, including from Ripple and co-founder Chris Larsen, were made directly in XRP, which meant no immediate upward pressure on exchange order books as cash was not being used for market purchases.
Analyst Predicts 'Supply Shock' from IPO Cash
Software engineer and prominent XRP community voice, Vincent Van Code, highlights that the bigger event might be the IPO itself, which is expected to bring in billions in new cash. He warns that if these substantial funds are later deployed to buy XRP on the open market, it could lead to a significant tightening of existing supply, triggering a 'supply shock'. Other market commentators, including Nietzbux, have already framed these developments as strongly bullish for XRP. The sequence of events—cash raised first, followed by potential public market purchases—is crucial, as large buys in markets with varying depth could significantly impact prices.
XRP's Evolving Role as a Treasury Asset
Beyond its traditional role as a payment bridge, a growing number of developers and analysts now view XRP as a treasury asset within the XRPL ecosystem. Van Code suggests a future where a significant portion of wealth could be held in XRP and on the XRP Ledger. Ripple’s CTO, David Schwartz, has also previously emphasized similar concepts regarding self-custody and on-ledger utility, reinforcing the argument for long-term demand for the cryptocurrency.