If the XRP ETF product scoops around 50% of the Bitcoin ETF’s total inflows after approval, the XRP price will reach levels last witnessed six years ago.
XRP ETF product launch plans are dominating discussions within the XRP community. This is primarily due to the potential that such products have in terms of driving XRP price movements.
XRP ETF could inject more capital
In particular, exchange-traded funds (ETFs) can attract more funds to the XRP market, especially from institutional investors. The market has observed this trend with Bitcoin as well, with over $17 billion of capital inflows observed to date since the launch of the ETF product.
As a result, BTC has broken its long-standing historical trend of hitting all-time highs before halving this cycle. While inflows have slowed since the first quarter of this year, Bitcoin ETF spot products continue to perform well.
Meanwhile, amidst the success of spot Bitcoin ETF products, discussions have emerged regarding the possibility of launching ETFs tied to other crypto assets. Ethereum, the second largest cryptocurrency, is the second to witness these products, but it is not as successful as the Bitcoin medium.
Interestingly, members of the XRP community believe that given the legal clarity, XRP is the next asset expected to launch a spot ETF. Recall that in May, Ripple CEO Brad Garlinghouse claimed that the launch of an ETF related to XRP, Solana, and Cardano could be imminent.
Notably, asset manager Grayscale Investments recently reintroduced the XRP Trust. This move was the first of four steps in the introduction of the XRP ETF. As a result, speculation surrounding the possible launch of an XRP ETF has gained momentum in recent days.
XRP price if XRP ETF captures 50% of BTC ETF inflows
If Grayscale moves forward with launching an XRP ETF, other asset managers may follow suit. This trend has materialized with Bitcoin ETF and Ethereum ETF. Furthermore, if these products record similar success to Bitcoin, it could result in significant gains for the price of XRP.
For example, the Bitcoin ETF currently boasts cumulative net inflows of $17.698 billion since its inception in January. If the XRP ETF witnesses 50% of this inflow, it could attract up to $8.849 billion in capital injections into the market.
Applying a 1:10 inflow to valuation multiplier would add $88.49 billion to XRP’s market cap. Notably, XRP’s market valuation at the time of the report is $33.237 billion. If the market welcomes another $88.49 billion, XRP’s valuation would jump to $121.73 billion.
Considering that the circulating supply of XRP is approximately 56.5 billion tokens, the price with a market capitalization of $121.73 billion is $2.15. This value represents a 265% increase from the current XRP price of $0.5890. The last time XRP saw the $2 price level was in January 2018, during a decline from an all-time high of $3.31.
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