2024-9-30 20:35 |
In a bold forecast for XRP, analyst “Cryptotank” has proposed that XRP, the native token of the Ripple network, could potentially skyrocket to a valuation of $1,000 per token.
This bold prediction comes despite XRP’s tumultuous journey over the past seven years, marked by regulatory hurdles, including the high-profile SEC vs. Ripple securities lawsuit.
In a series of tweets on Saturday, Cryptotank laid out a compelling case for XRP’s potential surge, grounding his argument in the token’s utility in the global financial system.
“Everyone saying 1k XRP is a fantasy doesn’t understand how the utility of XRP will drive price to unbelievable levels,” Cryptotank asserted, setting the stage for a detailed breakdown of his valuation model.
Notably, the crux of Cryptotank’s argument lies in the potential adoption of RippleNet, Ripple’s blockchain-based payment network, by major financial institutions.
The pundit stated, “Swift is adopting RippleNet currently into their messaging system for cross-border payments. ” This integration could revolutionize the way international transactions are processed and settled.
SWIFT (Society for Worldwide Interbank Financial Telecommunication) currently handles approximately $5-$7 trillion in daily transaction volume. However, SWIFT only manages the messaging aspect of these transactions, not the actual settlement. With RippleNet and XRP, both messaging and settlement could potentially be completed in 3-5 seconds at a fraction of the current cost.
“Currently the cost of a Swift messaging transaction is $20-$50 versus pennies with XRP. So, banks will be greatly incentivized to adopt RippleNet using XRP to save hundreds of billions in fees per year,” he argued.
Furthermore, the pundit described a scenario where banks settle just 10% of their transactions using XRP. According to the pundit, this would equate to about $500 billion in daily volume. Cryptotank argued that liquidity pools on the XRP Ledger would need to hold approximately double that amount, or $1 trillion, to facilitate such volume.
The price of XRP would then be determined by dividing this $1 trillion value by the amount of XRP available in liquidity pools. Assuming 10 billion XRP tokens are delegated to these pools, the price per XRP would be $100 to handle this volume.
“This is why XRP has to be very high to move just 10% of SWIFT’s daily volume. When you start adding the other banks in it gets crazy how high XRP will go,” he added, suggesting that utility by more institutions and banks could propel XRP to the $1000 mark.
That said, this price forecast, while seemingly fantastical to some, follows Ripple’s recent announcement of beta testing for RLUSD, a new stablecoin on the XRP Ledger and Ethereum networks. While not yet approved for trading, this development could further enhance XRP’s utility in cross-border payments.
XRP traded at $0.65 at press time, reflecting a 4.47% gain over the past 24 hours.
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