Fundamental analysis for Ripple shows XRP reaching $17-30 within 2 years

evo

Site Admin
Apr 2017
Seattle
#1
Its easy to see that Ripple offers tremendous value to financial-institutions and retail investors. These two groups make up 358 billion (numbers from 2013) non-cash cross-country annual transactions, and the FOREX market which sees more than $5.1 trillion $USD each day. Per a report released by Capgemini and The Royal Bank of Scotland, this is growing at an average rate of about 7.5% each year globally, though China and other Emerging Asian economies have been leading the charge at around 21%.

Seems like a lot, right? Well, for sake of uncovering the immediate value of XRP, we will zoom into the recent adopters of the distributed ledger technology: Japan, India, and the Central Europe, Middle East & Africa(CEMEA) regions.

Japan is the third largest economy in the world by nominal GDP ($6.11 trillion), fourth by purchasing power parity(PPP) and second largest developed economy. Currently, their GDP per capita is roughly $48,412 (vs $56,430 in US) and their major trade partners include the US, China, Hong Kong, Australia and South Korea.

Aside from the speculation that they maybe soon pressure their trade partners (excluding the US and China) to adopt a system which allows for instant, near free transfers of funds, here’s where it gets interesting for the immediate future: Japan has already started accepting Ripple(XRP) as legal tender. If Ripple raises to just 25% of the overall transaction volume of P2P, P2B & B2B within Japan itself (represented in the chart by Other Services, Real Estate, Retail, Transport, Communications, Finance & Utilities) which is equal to about 20% of their overall economy, Ripple would be handling roughly $1.27 trillion USD in Japan – alone - every year. To put that in perspective, the current (at the time of writing) market capitalization of Bitcoin(BTC) is $30.7 billion USD (or >0.4%). Unlike Bitcoin, Ripple is legal tender which means that it can be exchanged for material goods and services, which means that it’s likely to have explosive acceptance in the local area.

India-based Axis Bank announced in April that they will soon begin leveraging distributed ledger tech for cross-border transactions and to make banking simple and convenient for their customers. About 15 days’ prior, another large financial institution, Yes Bank, also announced that they would be adopting Ripples ledger for the same reasons. If Ripple continues to grow in acceptance at this rate in India, we could see another economy, roughly 1/3 the size of Japan’s ($2.074 trillion USD) add to Ripples annual transaction value. Now, from an economic stand point, this is most interesting because agriculture represents more than 50% of India’s employment, which means that India would be the 2nd case of consumer trading Ripple for staple foods.

It is likely that Ripple will not handle as large of a percentage of overall transaction volumes in India because only two major banks have adopted this currency and it is not the only Crypto. The latter is probably one of the most important variables, as this means that Ripple will be duking it out for market dominancy. As all of my projections are fairly conservative, I would estimate that Ripple will handle roughly 10% of India’s over all transaction volume in the next 365 days, equal to roughly $311.1 billion USD.

One last thing that I would like to mention is that India is literally the ‘I’ in BRIC and roughly 13% of the BRIC countries total output. If the BRIC comes to fruition, India may be able to convince it’s other close trade partners to jump on the XRP-Train as well.

Abu Dhabi Bank, the National and largest bank of the UAE, has already begun offering cross-border transaction services with Ripples distributive ledger technology as well. As they deal extensively with their middle eastern neighbors, such as Saudi Arabia, and Qatar, the UAE is likely to set a trend for other CEMEA countries to follow.

This might be a surprise to some people, but Dubai’s largest industry is the energy sector (shocker!) followed closely by Real Estate and their Finance industry (double shocker!). Although their GPD is much smaller than Japan and India’s (about $370 billion USD), I am anticipating Ripple to handle a larger percent of the UAE’s transaction volume (31.11%), especially in the finance, Real Estate, Retail and Logistics industries. This is due largely to the fact that their population is only roughly 9.157 million, but most Abu Dhabi nationals are very financially inclined (or at least heavy spenders).

Potential Threats
As this threatens SWIFT (unless they are completely on board) and the US dollars’ supremacy in the economic & financial markets, I would not be surprised to see a false flag attack, in which the NSA attacks Ripple and blames it on North Korea or China. Frankly, this would be a cake walk compared to Stuxnet or WannaCry and they could probably hand the task to an MIT intern. Where semi-centralization is Ripples strength in terms of transaction speed and regulation, it is also the biggest security flaw and may open it’s user to some heart ache, hair loss and heavy drinking over the next several years.

Possibility
So, what is possible in terms of value over the next few years? Well, if we consider the following scenario:
  • XRP accounts for roughly 20% of Japan, India full GDP, but 31.1% UAE’s GDP ($7.152 Trillion USD) total exchange volume in the next 2 years
  • Max XRP Supply stays at 100 billion
  • No other countries adopt XRP (not likely)
  • No hacks or other catastrophic events remove confidence
  • Exclude speculation, demand, rallies, and GDP growth projections for each country
Then we’re looking at each Ripple(XRP) market capitalization over ~$1.75 Trillion USD, making each coin $17.52 in real value. This means that if you were to invest today at $0.362794, your ROI would be about 4,989%. That said, I think that it’s likely it will go over $30 in the next 2 years, due to speculators flooding the markets and other countries signing up. Again, these are conservative numbers are based on total transaction value in USD equivalent.

Source: The Ripple(XRP) Effect - Fundamental Analysis
 
#3
I cant see ripple going up that high considering there is a lot of negativity towards it being a banker coin

i dont like ripple but i own some

its crashed a lot this month, a good time to buy,

i wont buy anymore, i have 2000 of them and it was by mistake

i will sell them soon
 
#5
because i sent too much bitcoin to bitstamp,

i sold all my ripple a while ago, its not volatile enough, it's a shitcoin, i made some quick cash but not enough from it

bitcoin is better for day trading,
 
#6
Agree there's not enough volatility for day trading Ripple, but then that's the way they're managing it. ETH and LTC are proving OK for that.

Ripple is a long term play and I think it appeals to a different audience than the Bitcoin crowd. While it's called the Banker coin there are plenty of new, hipster, lean start-up types looking at it too. Sure, they won't have the impact in terms of purchasing power and moving the price, that the big banks could, but it's not just bankers buying in.

As for price, I recently posted in the speculation thread a target of $5 to $10 by EoY 2018. One of the largest blockers to a price rise is the escrowed coins and active management of volatility. Once they're bought out (it would be good to map the progress of that) then I believe the price will move more significantly. Until then, it's a slow uptick subject to some significant news that makes buyers jump in and hopefully sell volumes reduce as people hold, thereby pushing the price up for buyers.

In the longer term of say 2 to 5 years, Ripple could certainly hit $30, I wouldn't be shocked at $100. At a price of under $1 Ripple is a steady accumulate and hold for me.

Cy
 
#7
Agree there's not enough volatility for day trading Ripple, but then that's the way they're managing it. ETH and LTC are proving OK for that.

Ripple is a long term play and I think it appeals to a different audience than the Bitcoin crowd. While it's called the Banker coin there are plenty of new, hipster, lean start-up types looking at it too. Sure, they won't have the impact in terms of purchasing power and moving the price, that the big banks could, but it's not just bankers buying in.

As for price, I recently posted in the speculation thread a target of $5 to $10 by EoY 2018. One of the largest blockers to a price rise is the escrowed coins and active management of volatility. Once they're bought out (it would be good to map the progress of that) then I believe the price will move more significantly. Until then, it's a slow uptick subject to some significant news that makes buyers jump in and hopefully sell volumes reduce as people hold, thereby pushing the price up for buyers.

In the longer term of say 2 to 5 years, Ripple could certainly hit $30, I wouldn't be shocked at $100. At a price of under $1 Ripple is a steady accumulate and hold for me.

Cy
Agree. I've read up as much as I can and this is not for someone looking to day trade. Buy a few thousand shares and just forget about it. They've got a top notch management team in place and with the recent addition of Tom Channick from FB leads me to believe, we will be hearing a lot more about this company in the upcoming months. The escrowed coins do seem to be a barrier to a price rise, but from what I understand, the escrowed coins are mainly allotted for institutional investors and anything that's not sold, goes back into escrow. I could be wrong on this so don't quote me.
 
#8
I personally think that, Ripple is doing well on the Go-To payment solution. So, it will effect the financial market, and it could be a reason or a factor for the price to go up. Just my newbie opinion.
 
#9
Of course Ripple can attain these heights. Like most of you I dont like Ripple, its a slave to the banks, plus I am sure the banks HODL lots of XRP too. $17 is possible. Take a look at other coins that could achieve the same: DeepOnion - was $20 now $2 and stealth addresses coming, along with mobile wallets. Surely a $100 coin? Also, look at OMG, holding its price pretty well, however the silence is great. Because when they say something it will be big. NEO can also 4x or more - watch for China.