The Potential Shift: Ripple as an XRP Treasury Firm
A Transformative Proposal
Recent discussions in the cryptocurrency community have sparked speculation about Ripple Labs potentially transitioning into an XRP treasury firm. This shift would resemble MicroStrategy’s strategy with Bitcoin, where the focus pivots from transactional use to treasury-style holding and investment in XRP.
Currently, Ripple holds a hefty stash of 40.67 billion XRP, equating to 41% of the total supply, valued around $122 billion. To put that into perspective, this amount surpasses MicroStrategy’s Bitcoin holdings, which amount to approximately 628,791 BTC at around $72.6 billion. The implications of Ripple adopting a treasury model could be significant not only for the company but also for XRP pricing and market dynamics.
Impact on XRP Pricing
As speculation grows about Ripple’s strategy, analysts have begun predicting potential price movements for XRP should this transition take place. Would a treasury-focused approach lead to an increase in demand for XRP? We sought insights from AI tools, ChatGPT and Google Gemini, to generate projections based on the proposed shift.
ChatGPT’s Projections: A Bullish Outlook
ChatGPT’s analysis yielded several optimistic scenarios. One notable prediction suggested that if XRP were to become a global reserve asset for cross-border payments—a market valued at approximately $150 trillion yearly—XRP could secure just 1% of this market as reserve capital. Such a development could propel XRP’s market cap to an impressive $1.5 trillion, translating to a token price of around $25.29 based on a supply of 59.3 billion XRP.
Further projections considered institutional demand. If Ripple’s pivot attracted significant buying interest from banks, funds, and corporations akin to Bitcoin’s surge in 2020 and 2021, ChatGPT suggested an increase in market cap to $2.5 trillion, lifting the price to approximately $42.15.
In another ambitious scenario, ChatGPT proposed that if XRP replaced traditional nostro and vostro accounts—currently holding around $27 trillion in idle liquidity—it could capture just 10% of that market, increasing prices to $45.53.
Even in a more conservative case, if Ripple were to lock its entire 40.67 billion XRP for a decade, effectively capping the supply to 59.3 billion tokens, the price might double from $3 to $6 based purely on market sentiment. Coupled with ETF inclusion possibilities, XRP’s market cap could rise to $550 billion, with projections placing XRP between $9.27 and $15.
Google Gemini’s Sorted Estimates
Conversely, Google Gemini leaned toward a more cautious stance in its projections. If Ripple were to permanently withdraw its 40.67 billion XRP from circulation, the market valuation would be redistributed across the remaining supply, potentially increasing the price to $5.06 per token if the market cap settled at $300 billion.
Gemini also examined the idea of a "MicroStrategy premium." By treating Ripple akin to a treasury-oriented organization, it could potentially add a 50% premium to its valuation, resulting in a market cap of $450 billion. This scenario places XRP’s price at approximately $4.50.
In a more optimistic idea, if XRP were to capture half of Bitcoin’s valuation, the price could soar to $11.50. If it matches Bitcoin’s market cap completely, XRP could reach an astounding $23.
Growing Adoption of XRP as a Treasury Asset
Ripple’s shift has broader implications that extend beyond its internal strategy. An increasing number of companies are adopting XRP as part of their treasury management strategies. For instance, Nature’s Miracle Holding Inc. recently announced plans to invest up to $20 million into an XRP treasury program. Other firms, such as Trident Digital Tech Holdings and Webus International, have disclosed commitments of $500 million and $300 million, respectively.
Further companies are exploring the potential of holding XRP in their reserves, effectively tightening supply and potentially driving prices higher. Bitwise CEO Hunter Horsley has speculated that Ripple could fully transition into an XRP treasury company within a year, spotlighting a significant industry trend toward adopting cryptocurrencies for treasury management.
This evolving landscape poses exciting possibilities for Ripple, XRP, and the broader financial ecosystem as companies grapple with asset allocation strategies in an increasingly digital financial world.
Moreover, the growing acceptance of XRP by various companies signifies a potential shift in view regarding cryptocurrencies as valid assets for treasury management, echoing MicroStrategy’s initial foray into digital currencies.
By keeping an eye on these developments, investors and enthusiasts can gauge how the landscape for XRP and Ripple unfolds in tandem with broader acceptance and institutional interest.
