With Ripple officially pursuing a banking license, what could this mean for XRP’s price potential?
Ripple’s Banking License Application: A Strategic Move
Ripple continues to expand its foothold in mainstream finance. CEO Brad Garlinghouse recently announced the company’s application for a national bank charter with the Office of the Comptroller of the Currency (OCC). This follows Ripple’s existing New York Department of Financial Services (NYDFS) BitLicense, positioning the firm for dual state and federal oversight upon approval.
Garlinghouse emphasized Ripple’s commitment to compliance, aiming to elevate trust in stablecoins. Additionally, through its subsidiary Standard Custody, Ripple applied for a Federal Reserve master account. This would enable direct custody of reserves for its upcoming RLUSD stablecoin at the Fed, enhancing its credibility.
Potential Implications for XRP and RLUSD
The announcement sparked analysis from prominent community figure “XRP Investing,” who noted that a national charter would align Ripple with traditional banking giants like JPMorgan, boosting RLUSD and XRP’s legitimacy. Key takeaways:
- Fed Master Account: RLUSD would gain unmatched stability with reserves held directly at the Fed.
- Regulatory Advantage: Combined OCC, NYDFS, and Fed oversight could accelerate institutional adoption of XRP for cross-border payments.
👉 Explore how XRP’s utility could transform finance
ChatGPT’s XRP Valuation Models
To estimate XRP’s price potential, we analyzed four valuation frameworks provided by ChatGPT:
1. Institutional Utility Model
- Assumption: Ripple captures 10% of SWIFT’s $150 trillion annual messaging volume.
- Velocity Factor: 25 (reflecting high turnover in crypto settlements).
- Circulating Supply: 55 billion XRP.
- Projected Price: $10.91 (utility-only baseline).
2. RLUSD + Fed Access Model
- RLUSD Market Cap: Matches USDC’s $32 billion (2024 benchmark).
- XRP Liquidity Role: Bridges $100 billion/year in RLUSD transfers.
- Trust Premium: 15x multiplier due to regulatory oversight.
- Projected Price: $13.65.
3. Tokenization Market-Share Model
- Tokenization Market: $16 trillion by 2030.
- Ripple’s Share: 3%, with XRP facilitating $120 billion in flows.
- Speculation Factor: 10x adjustment for institutional demand.
- Projected Price: $21.80.
4. NVT (Network-Value-to-Transaction) Model
- Daily XRP Volume: $30 billion (with bank adoption).
- NVT Ratio: 27.5 (midpoint of typical blockchain range).
- Projected Price: $16.36.
FAQs: Addressing Key Questions
Q: How would a banking license impact XRP’s liquidity?
A: Direct Fed access and regulatory clarity could attract institutional investors, enhancing liquidity and reducing volatility.
Q: Is RLUSD critical to XRP’s growth?
A: Yes—its Fed-backed reserves may incentivize banks to use XRP for settlements, driving demand.
Q: What risks could delay XRP’s price growth?
A: Regulatory hurdles or slower-than-expected adoption of Ripple’s banking infrastructure.
👉 Learn more about XRP’s role in decentralized finance
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Conduct independent research before investing.