Valhil Capital, a private equity firm, has recently published a groundbreaking research paper evaluating the fair value of XRP, and the results are nothing short of astounding. The report, leveraging six different pricing models, suggests that the fair value of XRP lies between $3,500 and $21,900 per token.
One community member highlighted the incredible potential of these projections, noting that at the median fair value of $12,822, owning just 77.9 XRP would suffice to become a millionaire. Even the most conservative estimate of $3,500 per XRP indicates that holding 285.8 XRP would be enough to reach millionaire status.
XRP Price to the Moon?
Molly Elmore, Chief Marketing Officer (CMO) at Valhil Capital, shared the whitepaper titled “A Comprehensive Approach To Determine The Fair Market Value Of XRP” on Twitter. She explained that the document is the culmination of an extensive two-year research project conducted by a “confidential committee” comprising a larger group of individuals.
The initiative was sparked by the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Ripple, which raised significant questions about the potential financial harm to retail investors. Valhil Capital aimed to determine the financial damages by assessing the extent to which the lawsuit impeded the adoption of the XRP Ledger.
The Concept of Fair Market Value
The research paper delves into the notion of fair market value and how it contrasts with the market value. To accurately determine the fair value, the Confidential Committee formed a smaller Valuation Committee in the fall of 2022, bringing together individuals experienced in quantitative and financial valuations.
The Committee developed six pricing models:
1. Pipeline Flow Model
2. Athey and Mitchnick Model
3. 99-Year Golden Eagle Model
4. Discounted Cash Flow Model
5. Collateral Model
6. Quantum Liquidity Model
These models consider a range of factors, including market conditions, supply and demand, and other pertinent elements.
Key Drivers of XRP’s Potential Value
According to the analysis, the primary driver of XRP’s price is the global decision to use it as a store of wealth. The white paper suggests that this shift will occur following a modest increase in XRP’s price due to its practical use.
For instance, the Pipeline Flow Model examines transaction volume, store of value, supply and demand dynamics, and the competitive interaction within the market. It posits that a significant “big bang” event, such as an explosion in FX trading volume on the XRPL, could trigger a substantial price increase.
Final Thoughts
Valhil Capital’s research presents an optimistic outlook for XRP, with the potential for substantial gains based on various valuation models. If these projections hold true, even a modest investment in XRP today could lead to unimaginable wealth in the future. As the world watches and waits, the future of XRP remains a topic of great interest and speculation.
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The sky's the limit for XRP, and this new research from Valhil Capital provides a tantalizing glimpse of what might be possible. Whether you’re a seasoned investor or a newcomer to the world of cryptocurrency, the potential for XRP is something that cannot be ignored.