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A recently surfaced sheet projects an $XRP price increase to an audacious $1,000 value, factoring in a daily cross-border payment volume of $1 trillion.
$XRP’s utility in cross-border payments, especially as utilized in Ripple’s On-Demand Liquidity product (now Ripple Payments), has contributed to the bullish sentiments surrounding the cryptocurrency among market participants.
$XRP’s Utility in Cross-Border Payments
This utility has caught the attention of multiple payment entities over the years. Last December, a JPMorgan report mentioned Ripple and $XRP as entities that could help unlock the $120 billion trapped in cross-border payments. The Crypto Basic also revealed in November 2023 that Grayscale highlighted $XRP as a potential alternative to SWIFT in cross-border settlements.
In addition, The American Institute of Physics, the IMF and the World Bank also spotlighted $XRP’s utility in cross-border payments in different reports. Interestingly, even SEC Chair Gary Gensler previously acknowledged $XRP’s advantages for use in cross-border payments over traditional fiat currencies.
With this utility recognized by the general public, investors believe $XRP is massively undervalued, projecting an imminent price explosion, especially on the back of a growth in the cross-border payment sector. Citing the Bank of England, Ripple noted in its 2023 New Value Report that the cross-border payment sector could witness a $250 trillion in volume in the next three years.
With this projection expected to materialize, pundits argue that $XRP would need to soar way beyond its current price below $1 if it captures a fraction of this volume. Mason Versus, an $XRP community figure and founder of Gold Squad, presented a sheet last August of hypothetical price requirements for varying cross-border payment volumes.
An Argument for a $1,000 $XRP Price
Market analyst EGRAG recently called attention to the document, lending credence to its content. In the sheet, the analysis evaluates what $XRP’s price would need to be for $XRP to cater to different daily cross-border payment volumes.
The $XRP Liquidity Cheat Sheet 🤫 pic.twitter.com/YBY3AF7ClJ
— MASON VERSLUIS (@MasonVersluis) May 21, 2023
At prices ranging from $100 to $500, $XRP could sufficiently handle daily payment volumes from $1 trillion, but this price becomes less feasible at volumes from $6 trillion to $20 trillion. This is because $XRP’s circulating supply of 55 billion would not be sufficient for the amount of $XRP tokens needed to handle these volumes.
Recall that finance pundit Shannon Thorpe previously argued that $XRP would be undervalued at $500 if it locked in a portion of the projected $250 trillion cross-border payment volume.
Versluis’ sheet proposes that $XRP would only sufficiently address daily payment volumes ranging from $1 trillion to $20 trillion if its price is at least $1,000. At a $1,000 price, the market would need to move 1 billion $XRP tokens to account for a $1 trillion volume and 20 billion tokens for a $20 trillion volume.
For $XRP to clinch a $1,000 price, it would need to skyrocket by a massive 188,543% from its current value of $0.5301. With this price potentially pushing $XRP’s market cap to an unimaginable $55 trillion, some industry commentators have strongly expressed doubts.
Moreover, some have pointed out that a $1 trillion daily cross-border volume is a difficult task for $XRP over the next ten years and beyond. For context, the entire global cross-border volume stood at $150 trillion in 2022, representing an average of $410 billion volume a day. A $1 trillion volume would be more than double this figure.