As Ripple (XRP) screeches to unforeseen lows for 2018, currently $1.11 at the time of writing, its worthwhile noting that all crytocurrencies are dipping and to inject a little optimism into the mix let’s do a realistic calculation of how much XRP could be worth.
Remember Ripple isn’t designed as coin for individuals to use, Ripple target predominantly the banking sector with the goal of making international payments and money transfers, quicker, cheaper and subject to reduced risk from currency fluctuations. Today to make an international payment it is mostly done by SWIFT, and takes 3-5 days. There are ways to do it quicker from a sender/receiver perspective but these generally cost more due to the increased risk that the transfer agent incurs.
So let’s take a look at SWIFT: Per day $5 Trillion is transferred. That’s a huge amount. The current market cap of XRP is $46 Billion. By extension if Ripple were to achieve its goal of replacing the SWIFT banking system it would a similar market cap if not more. So if $46 Billion market cap has a price of $1.11 then its simple to work out what $5 Trillion would be:
$5,000,000,000,000
/
38,739,142,811 XRP (circulating supply of Ripple)
= $129/XRP
This a huge figure, but its a minumum figure as it ignores other uses for XRP other than replacing the SWIFT system. However its unlikely that Ripple will replace the SWIFT system entirely and its an almost certainty that it won’t do it in a year. So let’s look at what’s realistic. Let’s say they replace 10% of the SWIFT system within this calendar year
$500,000,000,000
/
38,739,142,811 XRP (circulating supply of Ripple)
= $12.90/XRP
Its difficult to say with certainty but with the banks and money transfer agents they have currently its not unrealistic to say that perhaps 1% of transactions are soon to be using XRP in some way. That would give a price of $1.29. Not far away from where we are today. So if Ripple continue to sign clients at the momentum they have charted at the beginning of 2018 we have a decent price to aim at, depending on what you’re definition of the moon is we may have take off.
