According to Medium.com and others, XRP was created to one day run at $10k a coin and a breakdown of the digital asset’s construction shows this.
XRP was created as a replacement for institutional and retail financial systems, more explicitly SWIFT, to do that XRP needs a very high price.
Looking forward, the XRP ledger needs to be able to scale to serve 7.5+ billion people & even more devices. The current account mechanism likely doesn’t scale to this level. Therefore, only those accounts that are most needed should be created. The reserve provides a barrier to entry for unneeded accounts.
Arthur Britto – RippleLabs Co -founder
RippleLabs co-founder Arthur Britto said in 2017 that XRP must be scalable to accomodate the global populace and the growing number of devices.
Added to this Ripple CTO David Schwartz said that XRP has to increase in value to tackle and serve higher value transactions or networks like SWIFT.
Higher Price/Higher Liquidity
Schwartz says the price of XRP HAS to be higher to increase its liquidity, the degree to which XRP can be bought or sold without affecting price.
XRP is way undervalued as anyone with any real knowledge will tell you, the trouble is over the counter sales which does not affect the price.
So, how high can this go? If the entire $1.14 quadrillion value of all asset classes was tokenized via XRP, that would require at least $11,400 per XRP, it demonstrates the scale of liquidity that XRP is designed to handle
Mark Philips – Medium.com
In order for XRP to move value equivalent to SWIFT’s $5 Trillion a day, the digital assets price must be far higher at around $100 per XRP.
Increased demand for XRP liquidity from partners MoneyGram, American Express etc will increase the price, increasing liquidity on demand.
Global Scalability
One point we found fascinating is that approx. 1.7 billion people in the world remain unbanked, for many, the banking system is simply too expensive.
Incredibly RippleTech can allow the unbanked to join the global financial ecosystem, increasing liquidity and then, in turn, XRP’s value.
The XRP Ledger is a decentralized cryptographic ledger powered by a network of peer-to-peer rippled server. The current minimum transaction cost required by the network for a standard transaction is 0.00001 XRP (10 drops). It sometimes increases due to higher than usual load.
Ledger protocol explains, even if XRP reached its designed value of $10,000 per coin, transactional costs would unlikely go over the 10 cents mark.
Even when XRP reaches global domination and includes the Billions unbanked, the fees would still be orders of magnitude lower than current banks.
Final Thought
A little extra info, Ripple recently mentioned PolySign, developed by Arthur Britto and David Schwartz, discussed at UBRICON 2019.
Interestingly PolySign was set up to manage the trillions involved in institutional payments, potentially where banks will hold digital assets for ODL.
PolySign’s custody solution supports the full spectrum of digital assets and is designed to scale to trillions under management.
Expect big things in the very near future, serious moves are occurring leading towards XRP and Ripple’s global takeover, just do your own research!
