XRP would trade at this price if it hits its all-time high market cap

Crypto investors and traders often overlook the economics of cryptocurrencies’ supply inflation. Understanding this is key in a market as diverse as cryptocurrency.

In this report, Finbold looks at the XRP Ledger (XRP) economics from a different perspective. We have collected public market data from the leading indexes to understand the effects of an increased supply inflation. With that, it is possible to calculate the exact price XRP would trade if it ever hits the all-time high market cap.

In simple terms, an increase in supply generally counters the demand. The interplay of these two factors influences whether a cryptocurrency’s price rises or falls. Each cryptocurrency, including XRP, has its unique economic structure or ‘tokenomics.’

XRP had an all-time high market cap of $128.498 billion on January 4, 2018, according to TradingView’s CRYPTOCAP index.

Meanwhile, the token traded for as high as $3.84 on the same day, as registered by CoinMarketCap. An inverse calculation suggests a circulating supply of 33.463 billion XRP at that time.

CRYPTOCAP - XRP daily market capitalization
CRYPTOCAP – XRP daily market capitalization. Source: TradingView

XRP supply inflation and its economic effects

Let’s explore XRP’s supply inflation and its economic implications. As of this writing, XRP Ledger has a circulating supply of 53.718 billion XRP. This results in a supply inflation of 20.255 XRP (60.52%) in approximately six years, or around 10% a year.

XRP supply.
XRP supply. Source: CoinMarketCap

An XRP price projection also shows the economic effects of this inflation. In case the project reaches its highest speculative demand of $128.498 billion market cap, XRP would trade at a proportionally lower price than the corresponding all-time high.

Considering the circulating supply on November 23, XRP would be priced at $2.39 per token at its highest capitalization. Interestingly, a loss of $1.45 (37.7%) from the previous price of $3.84 in 2018.

However, this still indicates a potential 290% increase from the current price of $0.61.

It is important to understand that the forecast requires the same demand as 2018 for XRP. In this context, there are no guarantees that this demand will ever be seen again. On the other hand, it is also possible that a higher demand surges in the following years.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent Comments

No comments to show.
New Bookmakers
Playfina.com

The newest member of DAMA N.V. family offers more than 6000 games and accepts a wide range of cryptocurrencies, which are arguably the most widely used form of payment for gamblers right now.

Cryptoplay.io

In the year 2021, Cryptoplay Casino went live for the first time. To bitcoin enthusiasts, the online gaming site offers an amazing game library, exclusive bonuses, and promotions.

CryptoGames

Since its inception in 2014, this crypto casino has amassed a sizable following and an even stronger reputation. This all-crypto casino has 8 Provably Fair games, a faucet, and the ability to utilize one of ten cryptocurrencies.

PlayAmo

In general, if you're looking for information on the PlayAmo casino's features and idiosyncrasies, you'll find it here.

Oshi

Oshi Casino is a bitcoin casino with a simple instant-play interface that accepts euro deposits as well as other cryptocurrencies like Ethereum.