VivoPower International, a Nasdaq-listed company, recently made headlines by switching to an XRP-based treasury. This wasn’t just a random decision; it’s part of a carefully crafted, five-year strategy.
Why XRP?
CEO Kevin Chin’s personal experience with XRP since 2016 played a role. He saw its potential for low-cost transactions in emerging markets, aligning perfectly with VivoPower’s existing work in these regions. Adam Traidman, Chair of the Board of Advisors, highlighted a market gap: while many companies hold Bitcoin, none had made a similar move with XRP, despite its strong liquidity and large global community. Unlike holding Bitcoin as a static asset, VivoPower plans to actively use XRP.
Making XRP Work
VivoPower’s strategy isn’t just about holding XRP; it’s about actively using it. They’re using BitGo for custody and over-the-counter (OTC) conversions, staking XRP on the Flare Network to earn interest, and using Ripple’s RLUSD stablecoin for international payments. They’re already testing RLUSD for payments in the Philippines, aiming to address the slow transaction times of traditional systems in Southeast Asia and Africa.
The Five-Year Vision
VivoPower’s corporate structure allows them to potentially share staking rewards with investors as dividends – a significant advantage. They’re funding initial XRP purchases with equity, with further funding potentially coming from borrowing, but only if it makes financial sense.
The company acknowledges the volatility of cryptocurrencies but views it as an opportunity to generate yield over the long term. Their strategic planning focuses on a five-year horizon, mitigating short-term market fluctuations. Traidman believes that the current market conditions, including potential crypto ETFs and a more favorable regulatory environment in the US, create a stable foundation for top cryptocurrencies.
VivoPower is also exploring investments in startups building on the XRP Ledger, aiming to boost both their investment portfolio and XRP’s utility. They plan to expand RLUSD-based remittances to countries like Ghana and Kenya, where dollar liquidity is limited.
The Bottom Line
VivoPower’s long-term vision goes beyond simply holding XRP. They aim to build and engage with DeFi solutions, generating consistent income regardless of market fluctuations. Their confidence is rooted in a comprehensive strategy designed for long-term success.