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Ripple’s CTO Emeritus, David Schwartz, has admitted that the $XRP price may not always reflect rational market expectations.
David Schwartz, who previously served as CTO and now holds the title of CTO Emeritus at Ripple, recently spoke about concerns surrounding the price of $XRP. Notably, most members of the $XRP community believe the asset’s price does not fully reflect its real value.
They mention factors such as $XRP’s growing role in payments, recent regulatory progress, increasing institutional adoption, and inflows into $XRP ETFs. Despite all this, the token still trades around $1.5, which most believe is lower than expected. This has led to claims that the market may not be acting fairly.
Key Points
- $XRP trades around $1.5 despite strong fundamentals, leading to claims from community members that its price may be suppressed.
- Some community members recently discussed this issue with David Schwartz, asking if he believes $XRP may be facing mispricing.
- Schwartz argued that rational and well-funded participants in open markets usually correct mispricing over the medium to long term.
- According to Schwartz, if a clear pricing inefficiency exists, other market participants would act on it, quickly pushing the price back toward a rational level.
- Schwartz ultimately acknowledged that short-term inefficiencies can happen but stressed they cannot last long due to arbitrage between private and public markets.
Rising Concerns Over $XRP Price Behavior
Mr. Nobody, a pseudonymous $XRP investor, raised these concerns with Schwartz. He suggested that the market might already be preparing for a price adjustment, but that the process could be slow and not easily visible through standard market theories.
He also questioned how efficient pricing aligns with what is happening to $XRP. To him, the supply situation does not seem to match the current price, and this raises doubts about whether the market has fully accounted for all available information.
Schwartz Talks on $XRP Pricing
Responding, Schwartz said, over time, markets tend to act in a rational way. He explained that crypto markets include enough experienced and well-funded participants to correct pricing issues as they appear. As these markets remain open and active, people can act quickly when they spot opportunities.
He added that if someone believes a price is clearly wrong due to manipulation or some hidden factor, others can reach the same conclusion. Once this happens, they would trade based on that belief, which would push the price back toward a more reasonable level. As a result, he believes it is difficult to argue that long-term price movements are clearly irrational.
The Ripple CTO Emeritus then presented a practical scenario. According to him, a positive factor, which he called factor X, could support higher prices in the future, while a negative factor, factor Y, could hold the price down.
Let's say you think there's some factor, X, that should raise the price of an asset in the future. And let's say there's some factory, Y, that you think is holding the price of the asset down. The bull case for the asset has to be that Y will lessen or go away while X remains…
— David 'JoelKatz' Schwartz (@JoelKatz) March 18, 2026
A strong bullish case would depend on factor Y weakening while factor X remains strong. However, in a liquid market, if this situation is obvious, other participants would already act on it, and the price would adjust.
$XRP Price May Not Always Reflect Market Realities
However, Mr. Nobody pointed out that price discovery does not always happen smoothly. He called attention to ongoing exchange outflows and signs of institutional accumulation on-chain, which have not led to a clear rise in spot prices.
The investor suggested that this could be due to fragmented liquidity or the strong influence of derivatives markets, sometimes called “paper supply,” which may affect how prices move. He also presented the idea that pricing might first materialize in private OTC markets before showing up on public exchanges.
In response to this, Schwartz admitted that short-term gaps between market price and expectations can happen. He agreed that public prices do not always immediately reflect what the market might expect based on available data.
I definitely think there can be short-term cases where the price on public markets doesn't accurately reflect rational expectations. But I can't see how that can persist for very long given that people can buy in closed markets to sell in open markets and vice-versa.
— David 'JoelKatz' Schwartz (@JoelKatz) March 18, 2026
However, he argued that these gaps do not last long. According to him, traders can move between private markets and public exchanges, taking advantage of price differences. This activity helps bring prices back in line.
Schwartz’s comments suggest that while $XRP may remain around $1.5 for now, the market still has ways to correct itself. Even if short-term differences appear, the system will eventually adjust and reflect a more balanced price. Essentially, the price remaining at this level for long may confirm that $XRP is not necessarily mispriced.