Rumors about Ripple making a $20 billion offer to acquire Circle have spread across social media, sparking intense speculation within the crypto industry. However, a crypto expert has refuted these claims, explaining why such a deal would be financially unrealistic.
Market analyst Dom has stated on X that Ripple will resist making any offer approaching $20 billion for Circle. Based on Circle’s real financial results, Dom suggested that its market value should be $5 billion instead of the speculative $20 billion figure.
Circle operates USDC stablecoin as its major product, which has more than $60 billion in circulation. These funds are fully backed by liquid reserves such as U.S. Treasuries and cash equivalents.
Despite the large figure, Dom stressed that the assets backing USDC do not belong to Circle’s equity and hence cannot be considered as revenue-generating resources.
Also Read: Ripple Locks 700M XRP Without Usual Release—Is a Major Move Brewing?
Circle’s interest comes from its reserves, which remain predominantly invested in low-risk, short-term financial instruments. Circle’s value should be determined by its earning capability from interest rather than the value of funds reserved for its users.
fyi @circle IPO valuation is ~$5 billion (which is the valuation Ripple is looking at when it made its acquisition offer).
there is no way Ripple would offer $20 billion for Circle.
ps i see lots of people saying $5 billion is a low offer since circle holds $60 billion in…
— Dom (Bull/ish) | EasyA (@dom_kwok) May 2, 2025
Ripple’s Native Stablecoin Strategy Weakens the Case for Acquisition
Ripple recently introduced its stablecoin, RLUSD, which is backed 1:1 with U.S. dollar reserves and built on the XRP Ledger. With Ripple already in the stablecoin space directly, Dom highlighted that acquiring a competitor at a significant premium would not align with the company’s strategic or financial priorities.
Additionally, Circle’s business model is vulnerable to shifts in interest rates and increased regulatory scrutiny. These risks further support a more conservative valuation, especially when evaluating long-term sustainability and market positioning.
Dom explained that numerous crypto community members confuse assets under management with enterprise value. The resulting confusion drives companies to overvalue themselves in the market while creating inaccurate demands around acquisition deals.
Ripple’s historical business practices demonstrate prioritization for measured company expansion while sustaining in-house developments instead of arbitrary financial spending. The income projection for Circle supports Dom’s $5 billion valuation assessment as the most realistic calculation.
Conclusion
While speculation continues, Circle and Ripple’s strategic direction and financial structure make a $20 billion acquisition unlikely. Expert analysis reinforces that enterprise value, not total reserves, should guide expectations around such deals.
Also Read: Ripple Reportedly Increases Circle USDC Acquisition Offer to $20 Billion – Here’s What to Expect
