By Michael Scott
Crypto analyst Zack Rector views Ripple and XRP as significantly undervalued to offer investment opportunities.
Per Rector’s account, the rising valuation of Ripple heading into 2025 is yet to lift the company and XRP from prolonged undervaluation. In a recent X post, Rector considers XRP to present investment opportunities.
Ripple’s Implied Valuation Doubles to $20B
From 2022 to 2024, Ripple Labs has traded at the implied valuation of $7B – $10B on the Lingto platform. Nonetheless, Rector indicates this figure has now surpassed double figures, with Ripple currently valued at $20B on the same platform.
While the current upside portrays increased investor interest and a bold outlook, the crypto analyst is convinced the company’s value is underestimated. Rector adds that Ripple is not publicly traded on mainstream exchanges, including New York Stock Exchange (NYSE) and NASDAQ.
Ripple equity access is currently available in the pre-IPO private markets. Such is available to accredited institutions and investors that seek early exposure to the entity before it becomes publicly listed.
XRP Escrow Holding Curse?
Rector considers the primary cause of Ripple’s undervaluation to be the substantial XRP holding in the escrow account. The analyst illustrates that the escrow account has 40 billion XRP at the present price of $2.03 per token, which translates to over $81 billion.
The analyst highlights that when XRP changed hands at $0.50 for most months in 2024, the escrow holdings were valued at $20B. As such, the $7B -$10B valuation is mismatched, given the worth of the escrowed tokens.
The market observer notes that the valuation appears to shift with the XRP trading above $2. Still, it shows how the entity’s valuation hardly reflects the full value of the holdings.
XRP Path to $48
Although the market position for XRP has significantly improved since the previous month, most experts consider the $2 price to be a steal. Seasoned chartist Ali Martinez decried the low valuation of XRP despite staging an over 200% surge in November.
Martinez shared in X post the newfound optimism for XRP to attain a conservative target at $8.40 while a highly optimistic objective is at $48 in 2025. The analyst cites the recent breakout from the seven-year downtrend to support the ambitious outlook for XRP. Higher prices for XRP would elevate Ripple’s escrow holdings.
The elevation to $48 has attracted major skepticism, particularly within the crypto community of XRP surge to $48 as Martinez predicts. In particular, crypto analyst JayDee, though massively bullish on XRP, doubts the $2.75 trillion market cap. He indicates the lofty $48 target in this cycle has minimal likelihood.
Ripple’s Expands Business
Rector illustrated that beyond XRP, Ripple has recently undertaken massive diversification and growth. The analyst notes the Ripple business is in various sectors, including custody services and the newly unveiled RLUSD stablecoin.
Ripple unveiled the native stablecoin this month, anticipating a share of the sector currently dominated by Tether (USDT) and USD Coin (USDC). The analyst notes that in profit earned, Tether outperformed financial giants, including BlackRock.
Rector is convinced that the potential for Ripple’s growth via the stablecoin is immense. Additionally, the RLUSD is set to grow the demand for XRP identified for settling gas fees. Sharp demand will propel the XRP prices higher.
Promising Opportunities
Ripple chief Brad Garlinghouse has recently re-ignited confidence in the XRP community, announcing a series of developments. While RLUSD stablecoin is on the project list, Garlinghouse explicitly hints at possible approval for spot XRP exchange-traded funds (ETFs) next year.
The latest statement reflects the success of spot Bitcoin ETFs since their approval to signal spot XRP ETFs is on the horizon. Such optimism is tied to the incoming pro-crypto leadership at the Securities and Exchange Commission (SEC) as Paul Atkins becomes the chair.