Ripple has been pretty darn stagnant recently - only being able to increase by a total of 10% over the past 3 months. This is pretty lacklustre compared with the 135% Bitcoin increase and the 88% Ethereum price increase over the same period.
However, even though price action has been flat this year - the development behind the Ripple project continues to bubble. The Ripple project was started around 2012 and has been growing at an alarming rate ever since. Over the course of the 7 or so years, the Ripple team have managed to amass a string of serious partnerships that include the World Bank, the IMF and a series of the worlds top banks.
This continued institutional involvement for Ripple has many analysts believing that Ripple will be going places - pretty soon. As an example, InvestingHaven has released their prediction for Ripple to reach $20 by the end of 2019 - a very audacious prediction considering that Ripple is trading at $0.40 and we are already 6 months into the year.
In this piece, I would like to explore what would happen once Ripple reaches a value of $10. I would like to preface this by saying I do not expect Ripple to reach $10 by the end of 2019 nor do I believe it would reach $10 during 2020. However, I do believe that if the team continues to increase its string of partnerships as they have been doing, Ripple has the potential to reach $10 within the next 5 years.
The Case For A $10 XRP
Currently, XRP is trading for a price of around $0.40 which gives it a market cap of around $18.86 billion. For Ripple to rise and reach the $10 level - the market cap for Ripple will then expand to the $425 billion level.
Looking at the weekly chart above - we can see that the previous ATH for XRP was around $3.65 during January 2018. At this time - the market cap for XRP was around $135.5 billion. For Ripple to reach our $10 target level - it will need to outstrip this previous ATH by a long margin.
However, as previously mentioned - Ripple has amassed a string of high profile partnerships. Just in March this year, Ripple had made it to the World Bank’s official homepage as they praised blockchain technology and the efforts made by Ripple. Furthermore, they went on to state that their xRapid pilot along the US-Mexico corridor was a success saving companies between 40%-70% in fees.
The IMF has also expressed interest in the Ripple project as the Chairperson, Christine Lagarde, had invited Chris Larson, co-founder for Ripple, to come and discuss how DLT can impact the financial industry. Furthermore, Lagarde has been very vocal about banks needing to step up their game or be at risk to be ‘cannibalised’ by new blockchain technologies.
A string of very high profile banks are already using Ripple’s technology to facilitate remittance transactions across borders and their response is very promising. PNC Bank, one of the top 10 US banks with over $60 billion in deposits, has been partnered with Ripple since 2016 and has most recently started to use xCurrent in 2018. Further banking partnerships include Euro Exim Bank, Santander and Standard Chartered.
If Ripple can continue to gain further high profile partnerships and help to reduce fees amongst their banking partners they will continue to grow toward the $10 level.
So What Happens At A $10 XRP?
XRP currently has a total supply of around 42.5 billion XRP tokens. At a value of $10 each - this would put the entire market cap for Ripple at $425 billion. This would make Ripple a very powerful company - putting it in the top 10 market cap companies in the world.
At a value of $10 Ripple would be bigger than Visa, MasterCard, JP Morgan + Chase, Exxon Mobil, Walmart, Bank of America and Disney - putting it in a very powerful position worldwide. Companies such as Microsoft, Amazon, Apple, Google and Facebook will all still be bigger than Ripple at this point.
Furthermore, at a $10 XRP - Ripple would have a market cap that is bigger than the entire Nominal GDP of Argentina, South Africa, Israel and Denmark.
So can Ripple really hit $10? The answer is yes. However, this would require the entire cryptocurrency market to be very strong. The entire market cap for the cryptocurrency industry will need to be near the $1.5 trillion level or above to even have a chance for Ripple to reach $425 billion.