According to crypto analyst Zack Rector, XRP remains undervalued despite the increasing valuation of Ripple.
In an insight shared on X, he said the growing valuation for Ripple will continue to attract investor interest as we head into 2025. Rector explained that for the better part of 2024, Ripple had an implied valuation of between $7-$10 billion on different crypto platforms.
However, this valuation has more than doubled, and the company is now valued at about $20 billion. This surge in valuation reflects growing investor interest; nonetheless, Rector believes Ripple is still undervalued at this current valuation.
The crypto analyst added that the most important consideration regarding the valuation of Ripple is the nature of its stock. Unlike most companies traded on platforms like NASDAQ or the New York Stock Exchange, Ripple’s equity is available only on pre-IPO private markets.
It is accessible to accredited investors and institutions seeking early exposure to the company before it goes public. Rector still believes that the actual value of Ripple, including its XRP holdings, is not adequately captured in its current valuation.
Implications of Ripple’s XRP Holdings
Rector argued that the large amount of this digital asset in Ripple’s escrow holdings was a significant factor in its undervaluation. Ripple has about 40 billion XRP in escrow, worth about $83 billion based on the coin’s current value.
Rector pointed to the disparity between Ripple’s market valuation and the value of these escrowed tokens. He explained that when the cryptocurrency was changing hands for $0.50, Ripple’s escrowed holdings were valued at approximately $20 billion.
Hence, a $7- to $10-billion valuation of the company doesn’t match the value of these escrowed tokens.
Price Outlook
Despite the coin’s recent price fluctuations, market analysts are bullish about its potential. Analyst Ali Martinez recently pointed out that despite the coin’s 235% surge in the last year, its current price creates opportunities for investors.
He predicts that XRP could reach $8.40, while his more optimistic projection sees it hitting $48 in 2025. Martinez believes these targets are supported by the crypto asset’s breakout from a seven-year downtrend.
CoinGecko data shows that the coin’s price is down 4.4% in the last 24 hours, trading at $2.08.
XRP’s 24-Hour Price Chart. | Source: CoinGecko
