Need 100 XRP to become a millionaire? research suggests

Valhill Capital has published a new research paper assessing the fair value of XRP, and the results are astronomical. Using six pricing models, the private equity firm suggests in the research paper that the fair value is somewhere between $3,500 and $21,900 per token.

Therefore, as one community member pointed out, only 77.9 XRP would be needed to become a millionaire at an average price of $12,822. Even at the most conservative projection of $3,500, 285.8 XRP would be enough to become a dollar millionaire.

XRP Price to the Moon?

Molly Elmore, Chief Marketing Officer (CMO) of Valhill Capital, shared the white paper titled “A Comprehensive Approach to Determining the Fair Market Value of XRP” via Twitter. According to him, the document is the result of extensive two-year research conducted by a “large group of individuals,” the “Secretary Committee.”

The origin of the effort was the US Securities and Exchange Commission’s (SEC) lawsuit against Ripple, which raised the question: if the SEC’s lawsuit harmed retail investors, how could financial damages be calculated? To do this, Valhill Capital argues that it is necessary to examine the extent to which the lawsuit prevents the XRP Ledger from realizing its intended use case.

Because of this, the concept of fair market value came into the discussion and how it differs from market value. To assess fair value, the Confidential Committee formed a small evaluation committee in the fall of 2022, composed of individuals with experience with quantitative and financial valuations.

As a result, the committee established six pricing models: the Pipeline Flow Model, the Athy and Michnik Model, the 99-Year Golden Eagle Model, the Discounted Cash Flow Model, the Collateralized Model, and the Quantum Liquidity Model. All models are concerned with a variety of factors, including market conditions, supply and demand, and other relevant considerations.

However, according to the analysis, the most important driver of the asset’s price is the extent to which the world decides to use XRP to store the asset. According to the whitepaper, this will happen when people using the asset see a slight increase in price.

For example, the pipeline flow model looks at transaction volume, store of value, interaction factors of supply and demand, and the interaction dynamics of competition. It believes that a “big bang” event will be triggered by a sudden explosion of FX trading volume on XRPL.

Thesis and assumptions are controversial

It should be noted that Valhill Capital’s thesis should be taken with a grain of salt. Even in the XRP community, founder Jimmy Vallely and his buyback theory are more than controversial.

Various well-known members of the community, such as attorney John E. Deaton and CryptoEry, have distanced themselves from the buyback theory. Deaton made it clear in February this year that he would not accept any money from Wally for his efforts in the Ripple and LBRY cases.

XRP buyback theory before 2021. According to Wally, XRP will become the world’s reserve currency when government debt reaches unsustainable levels. He believes that this is possible only if the government buys a large amount of XRP, at a much higher price than it currently is.

At press time, XRP was priced at $0.5209.

Featured image from iStock, chart from TradingView.com