According to ChatGPT's predictions, if XRP becomes the preferred bridge currency for global CBDCs, its price could reach triple digits.
If XRP becomes the preferred bridge currency for global CBDCs, its price has the potential to reach triple digits.
It is worth noting that the trading price of XRP today is $2.19, having risen over 3% in the past week. However, despite the current price, many investors still believe its valuation is too low. This is due to the increasing practicality of its real-world payments, especially as it can function as a bridge currency for central bank digital currencies (CBDCs).
As the momentum for CBDC development grows, the demand for fast, neutral assets that can connect different currencies for cross-border use is also increasing.
In terms of background, over 130 countries (accounting for 98% of global GDP) are actively researching or testing CBDCs. Therefore, some industry commentators point out that XRP, with its speed and low transaction costs, is a potential bridge candidate for when these CBDCs are launched.
However, the impact on price remains uncertain. To explore if XRP can serve as a bridge for global CBDCs, we asked ChatGPT to make estimates based on market data and reasonable assumptions.
Factors that may influence XRP's price
ChatGPT identified three factors in its assessment: transaction volume, liquidity demand, and XRP supply. Today, the forex market has a daily trading volume of over $7.5 trillion. If XRP only accounts for 1% to 3% of the CBDC-related transaction flow in that market, its daily settlement could reach $75 billion to $225 billion.
It is worth noting that strong liquidity is needed to support such high transaction volumes. Analysts typically use a simple formula to calculate liquidity needs: dividing daily transaction volume by how many times XRP is moved in a day.
If each XRP moves five times a day, when transaction volume reaches $100 billion, the system will need $20 billion worth of XRP available at all times. Based on the current circulating supply of 55 billion XRP, the base price per token would be approximately $0.36 just to meet liquidity needs.
XRP base price ChatGPT
If XRP can bridge CBDCs globally, its price
However, this is only part of the assessment. ChatGPT noted that this number does not reflect market dynamics such as speculation, holding, or increasing scarcity. Taking these factors into account, ChatGPT has predicted a range of potential prices.
Specifically, as basic adoption as a bridge currency increases, XRP could rise somewhere between $10 and $20. If global usage expands and liquidity demand rises, the price could reach $50 to $100. If XRP has a broader vision but lower adoption rates, slower speeds, and reduced supply, the price could jump to $120 or even, in the most optimistic scenario, reach $500.
If XRP becomes a bridge for global CBDCs, what would its price be? | ChatGPT
Nevertheless, ChatGPT emphasizes that all of this depends on factors such as regulatory approval, widespread adoption, and actual usage. Although this remains uncertain, the momentum of XRPL in the CBDC space continues to grow.
Some national banks and global financial institutions have already been using XRP ledgers in pilot projects. Ripple has partnered with countries like Palau, Bhutan, Georgia, and Montenegro. While these projects do not rely on XRP itself, their use of private ledgers similar to XRPL indicates the network's appeal for CBDCs.