Ripple’s XRP token has been in the spotlight recently due to increasing interest in cryptocurrency exchange-traded funds (ETFs). The potential influx of capital from these products could dramatically impact XRP’s price, as a recent study by TheCryptoBasic explores. 5% of Ripple’s total XRP supply – around 4.95 billion tokens – is a key factor influencing the analysis.
A hypothetical scenario where ETFs capture just 5% of the circulating XRP supply has been explored. This action would result in approximately $12.3 billion worth of tokens being removed from the open market, creating a noticeable supply squeeze. The study emphasizes that the true impact on XRP’s price will be influenced by how this influx translates into overall market valuation.
The CryptoBasic used a conservative 70x multiplier to estimate potential market valuation changes. Based on this model, if $12.3 billion enters XRP ETFs, it would lead to an $861 billion increase in total market cap – a staggering growth that could bring Ripple’s market cap close to a trillion dollars. The study concludes by highlighting the regulatory advantage of XRP ETFs in opening doors for institutions seeking exposure to cryptocurrencies.
The uncertainty surrounding the exact timing of XRP ETF approval remains, but growing institutional interest in other assets suggests a clear trend toward greater liquidity and accessibility.