Hostile takeovers of companies aren't cool. You know what's cool? Hostile takeovers of cryptocurrencies. That's the thinking behind something called Valor, which Axios has learned is in the early stages of attempting a hostile takeover of XRP, a $14 billion cryptocurrency that is majority-controlled by a VC-backed company called Ripple. If successful, it would mark a major win for proponents of decentralized blockchain, and help Valor achieve its goal of deploying a digital remittance system for developing counties. It also would be a massive loss for Ripple, and possibly launch copycat attacks on other cryptocurrencies. Before continuing, two very important notes: Valor was originally launched in late 2017 by Vishal Harpalani, who previously spent three years working with early Ripple investor Flight Ventures (led by Gil Penchina). Harpalani's original plan was to raise $160 million via an initial coin offering for a new cryptocurrency that would become a widely-distributed source of stored value in developing countries. It also would partner with mobile wallets and mobile carriers that do business with the underbanked, thus helping Valor achieve network effects (and lower the switching costs from fiat currencies). But the plan wasn't a hit with investors. Harpalani maintained the basic aims of Valor, but decided the better means would be to effectively execute a hostile takeover of XRP. How it would work: Harpalani confirmed to me that Valor is working on a "hostile takeover of a top ten cryptocurrency," but declined to discuss XRP or Ripple. He also confirmed that his advisors include serial entrepreneur Alan Braverman (Yammer, Xoom, etc), although Braverman didn't return a request for comment. Will it work? Probably not. Particularly given that Valor is still fundraising and working on its code, which means Ripple still has several months to develop the crypto equivalent of a poison pill. Plus, even if Ripple can't apply defenses, there are still tons of challenges – not the least of which is convincing enough large XRP holders to make the switch. But it's an interesting thought experiment, and the first known attempt at something that an entrepreneur named Chris Herd first mused about last spring on Medium. Bottom line: There is a growing crypto battle between decentralization purists and a newer generation that doesn't mind the presence of central companies like Ripple (or, coming soon, Facebook). Valor, even if it never gets off the ground, is a sign of the skirmishes to come.
A hostile takeover of the entire XRP is reportedly being planned by an initiative known as Index . The $ 14bn XRP is majority - owned by Index , a venture - capital backed firm . Valor is said to be raising funds to short XRP , then create a fork via which holders of the Index shares could receive a Valor token for each XRP token . It would then encourage more XRP holders to swap their tokens by offering extra Valor to its community . The concept highlights the growing rift between those committed to crypto 's decentralisation ethos , and those who support firms such as Ripple .