The price of XRP could skyrocket to 186x its current level if XRP captures the $5.8 trillion market cap of the total supply of US Treasury Bills (T-Bills).
This assessment arose in the XRP community after Tokenized Treasury Bills ReportsNotably, OpenEden, a well-known tokenization platform, announced the implementation of tokenized treasury bills on the XRP Ledger (XRPL), and Ripple has committed to invest $10 million.
Treasury Bills on XRPL
For those unfamiliar, Treasury bills are short-term government securities that mature in one year or less. They are issued US government to raise funds for short-term needs and manage public debt.
Notably, the government typically sells them to investors at a discount to their face value. The difference between the purchase price and the amount the government pays at maturity is the investor’s return. Treasury bills are available to individual investors, financial institutions, corporations, and foreign governments.
The OpenEden initiative will allow investors in Treasury bills to tokenize their investments and hold them on the XRPL. This will involve converting the ownership of these traditional financial assets into digital tokens that exist on the XRPL Blockchain instead of a paper certificate or digital record in a traditional system.
XRP Price at $5.8 Trillion Market Cap
Notably, the total market cap of existing Treasury bills held by investors is huge. In the unlikely event that most of these investors decide to tokenize their holdings on XRPL, this will have a huge impact on the price of XRP, which is the gas token for the ledger.
Captain XRP, an XRP community figure, recently attempted to assess this impact. He mistakenly came to the conclusion that existing Treasury bills boast a market cap of $27 trillion. Citing this figure, a community commentator found that XRP could skyrocket to $482 if it reaches that market valuation.
However, according to Statista, the $27 trillion figure actually represents all outstanding U.S. Treasury securities as of two months ago. Of that figure, $5.866 trillion represents the total value of outstanding Treasury bills. Treasury bonds, which have a longer maturity than bills, account for $14 trillion.
Notably, despite the reduced figure, if a significant portion of the $5.866 trillion Treasury bill market cap were to be tokenized on XRPL, the impact could be enormous. Underscoring Captain XRP’s theory, the increase XRP Market Cap to $5.866 trillion would result in an XRP price of $104.7 with a circulating supply of 56 billion tokens.
This price would represent a whopping 186x increase over XRP’s current price of $0.5605. However, this estimate remains highly speculative. For example, while the tokenization of Treasury bills on XRPL will undoubtedly increase the value of XRP in the long term, the extent of such an impact remains unknown.
