Ripple investors receive Cherokee discount acquisition bond proposal! Deaton: Value may double after IPO

Recently, a Ripple investor exposed a letter from Cherokee Acquisition, showing that the company intends to acquire debt related to Linqto Texas, LLC (case number 25-90186) at a discounted price. This move has attracted market follow, as it involves the potential valuation of Ripple private sale equity and IPO prospects.

Cherokee's acquisition proposal

According to the content of the letter, Cherokee provided two acquisition prices:

Claim amount ≥ 100,000 USD: Acquisition price is 70% to 75%

Claim amount < 100,000 USD: acquisition price is 65% to 70%

The company promises that the seller can receive cash compensation immediately, while the risk of waiting for Ripple shares to be liquidated will be borne by Cherokee.

Deaton's Professional Interpretation

Renowned lawyer John Deaton explained that such companies typically acquire at a price below the full amount of the debt, profiting after asset distribution or liquidation.

He cited an example where if an investor bought $100,000 worth of Ripple stock at $40 per share, Cherokee might offer between $60,000 and $75,000 for acquisition.

However, according to secondary market data, the current price of Ripple shares is close to $100, while the latest internal price of Ripple has reached as high as $175. This means that the book value of the investment may have exceeded $200,000.

Deaton emphasized that the quote from Cherokee is based on the original investment amount, rather than the current unrealized gains, which may result in the seller losing significant potential value.

Why Ripple Investors Need to Be Cautious

Ripple's private sale equity shares are not available to investors before the IPO, and they must also go through a lock-up period before trading after the IPO. This waiting period provides liquidity intervention opportunities for companies like Cherokee.

Although discounted acquisitions can provide a quick cash-out option, this price is clearly discounted compared to the potential valuation after Ripple's IPO.

Deaton suggests: "Unless you urgently need funds, holding long-term might be a better choice. I don't understand why some would sell before the IPO."

Conclusion

The acquisition proposal from Cherokee provides liquidity for Ripple investors, but it may also cause sellers to miss out on the huge potential gains after the IPO. For investors who are not in a hurry to cash out, patiently waiting for Ripple's listing may be the key strategy to maximize returns.