Why XRP Could 10X (Tokenization, BlackRock, Genius Act, RLUSD)

Today, I want to help break down some of the rumors and developments around XRP, which I think are super fascinating. I actually believe this technology is going to be very important. Ripple is a company of really professional people working really hard on this. That's why we chose XRP. We believe in XRP. We're not making a price prediction, but we do believe it's a it's a coin that that will have the most utility out there. Canadian XRP ETFs, for example, which launched just a few weeks ago, have already seen roughly 280 million dollars in trading volume. And BlackRock, which is the world's biggest asset manager with over 10 trillion dollars under management, is rumored to be exploring XRP's blockchain technology to tokenize their global assets. But there's also rumors of Bank of America potentially partnering with Ripple. And there's also breakthroughs like the Genius Act, which are clearing the way for Ripple's stablecoin RealUSD. And before I get into it, I like to start these videos by showing you my portfolio so you can judge for yourself exactly how biased I may or may not be. So full transparency, XRP represents a very small percentage of my portfolio. It's about zero point one percent. So I'm definitely not all in. But my XRP holdings have grown by over 10x from my initial investment. And even if just some of the predictions were to come true from this video, it could represent a much bigger part of my portfolio in the future. Now, this is just a reminder that as you're watching this video, please remember that this will be very speculative. It'll be exciting. And as always, please don't treat this as financial advice because it's not. So let me get into exactly why people are dreaming of these insane price predictions again and why there might actually be something real behind all the hype. So with that said, let's get into it. Hi, my name is Andre Jik. Hope you're doing well. Come for the finance and stay for XRP. Now, in the middle of June this year, Canada became the first major market to greenlight spot XRP ETFs with Purpose Investments, 3iQ and Evolve. They all launched their funds on the same day. And in just the first week, those three ETFs traded about 280 million Canadian dollars worth of XRP. What's even more interesting, though, is that these ETFs outpaced the initial volumes that were seen in a lot of the early Bitcoin and Ethereum funds in Canada, which means the demand for XRP is really high right now. Now, at the same time, though, here in the US, there were 11 separate filings for spot XRP ETFs. They are now pending with SEC and analysts from Bloomberg are now assigning a better than 80 percent chance that at least one of these US XRP ETFs will be approved by the end of the year. Now, if this were to happen, though, we could see the same pattern that happened in Canada, that the XRP ETFs could see more money flowing into them than both Bitcoin and Ethereum ETFs. But next up, let's talk about regulation and why it actually matters for XRP's real world use cases, because on July 18th, Congress passed and the president signed the Genius Act, which is the first ever federal framework for dollar backed stable coins. Now that this law is in effect, it's going to require every stable coin to be 100 percent backed by liquid assets, have monthly reserve audits to make sure that everything's legit and stable coins will have to meet strict consumer protection standards. Now, for Ripple's XRP, this is huge because it clears the way for their own stable coin, RealUSD, to go live on the XRP ledger without constant uncertainty. Now, once RealUSD is in circulation, it can fuel what's called ODL or the on demand liquidity, which is Ripple's product that uses XRP as a bridge currency to settle cross-border payments instantly. Now, that's a lot of complicated words, but imagine banks or payment providers on ramping dollars into RealUSD at one end, moving the value on the ledger in seconds. Then off ramping back to dollars on the other side, all without the delays and fees of traditional banking. And because RealUSD sits on the ISO 222 standard, the XRP ledger has sub one second finality, 1500 transactions per second capacity and very, very small fees, which means it could process billions and billions in daily volume at a tiny fraction of today's costs. So while these ETFs are making all the headlines, I think the behind the scenes real upgrades are really what turns speculation into real adoption. But now that the Genius Act has been approved, there's something really interesting that's happening in the banking and credit world. Credit card companies and payment networks will have to start partnering with crypto companies to put the scale into perspective of just how big that would be. Global cross-border payments crossed around 190 trillion dollars in 2023, and there's estimates that it would reach 290 trillion by 2030. Now, stable coin market caps are also estimated to reach 500 billion to a trillion dollars in the next few years. And even capturing just a fraction of that market would represent a huge opportunity. And companies like Visa have already figured this out. They've already announced plans to integrate digital payments on its networks. And there's rumors that Bank of America is exploring a partnership with Ripple to leverage on demand liquidity and real USD. Bank of America CEO Brian Moynihan says the bank would consider a stable coin if U.S. regulations allow it. Speaking at the Economic Club of Washington, D.C. on Tuesday, Moynihan said it's pretty clear dollar backed stable coins will garner mass adoption. He also said that if the Trump administration and lawmakers on Capitol Hill pass stable coin legislation, Bank of America would go into the business of stable coins. Now, to be very clear, this is still a rumor, but if it were to happen, that would be huge. Now, at the same time, though, Ripple has applied for a U.S. national bank charter with the OCC. They're applying for a bank license. And if it's given, it could settle deposits directly with the Federal Reserve, bypassing traditional banks completely. So when you combine all of this, though, a bank license and the potential partnership with other banks, it could really push XRP and its ledger in the center of the U.S. financial plumbing system. And that would dramatically increase the chances that institutions would adopt the ledger for the next part that I want to show you, which is tokenization. Now, tokenization is going to change the world and how we invest. I believe the next generation for markets, the next generation for securities will be will be tokenization of securities. The tokenization of financial assets could reach multiple trillions by 2030. But here's what it means. Tokenization is the process of taking something of value, like the stock of a company, a piece of real estate or even a piece of a Pokemon card and turning it into a digital token on a blockchain. So imagine owning a fraction of a beach house that you think will go up in value instead of buying the whole house, which most of us can't afford to do. Each token will represent a tiny slice of that underlying asset. And because it lives on the blockchain, these tokens can be traded instantly anywhere in the world, 24 7 without the usual layers of brokers, custodians and clearing houses that slow everything down and add cost to traditional transactions. Now, I can't overestimate just how big this will be in the future. And believe it or not, Robin Hood is actually doing this right now. They are tokenizing the U.S. stock market as a way to allow the European markets to buy U.S. stocks. What we announced last Monday in the south of France are several products for the EU stock tokens, which give exposure to public listed equities. We have over 200 and those are available 24 5, finally giving our European customers exposure to U.S. stocks. It's kind of like a backdoor access to U.S. markets without needing regulatory legal approval. Now, the rumor, though, is that BlackRock, which, again, is the world's biggest asset manager, is quietly looking at blockchain platforms to be their backbone for issuing tokenized versions of not just stocks, but everything from treasuries, ETFs to fractional real estate shares. So if BlackRock or if any other blue chip asset manager were to choose the XRP ledger to create and settle these tokenized assets, it would instantly validate Ripple's technology. Of course, this is still a very big rumor, very speculative. And until we see a joint press release or a regulatory filing, I would classify this in the high risk, high reward category. But that's partially why the price of XRP is going up. Markets are trying to predict the future and they do that by pricing in at least a part of the what if scenario. But now let's get a little hypothetical and translate what all of this could mean for XRP's price using today's actual numbers. Keep in mind, all of this is going to be super speculative. But first, did you know that you can actually earn XRP without ever buying it? That's what I've been doing with Bitcoin credit card by Gemini, which is today's sponsor and actually a credit card I've been using for a while now. So all opinions are my own and we're not influenced by Gemini. I use this like any other regular credit card for gas and groceries, and I earn Bitcoin every time I use it. It has no annual fee. You can see the rates and fees in the description down below for more info. But this thing gives you up to 4% back and over 50 cryptocurrencies instantly. You can choose which one you want. Personally, I have it set to Bitcoin, but you can also choose XRP if you like. But that's 4% on gas, transit and ride share, 3% on dining, 2% on groceries and 1% for everything else. It's also a MasterCard World Elite, so I've used it internationally with no issues. And I like knowing that every time I swipe, it adds to my stack, which is something I plan to hold for in the long term. And here's the magic. You're investing as you spend. In fact, according to Gemini, cardholders who earned and held their Bitcoin for one year saw an average appreciation of 176%. Those are not your typical credit card points. So if you're interested, click the link in the description or go to Gemini.com forward slash Andre and get $200 in Bitcoin when you spend $3,000 in your first 90 days. Thank you, Gemini, for sponsoring this segment of the video. And now let's get back to it. As of right now, XRP's market cap sits at about $188 billion, with roughly 59.2 billion tokens in circulation. Now, in a conservative scenario, let's assume that BlackRock does a test pilot and they tokenize 5% of their AUM or assets under management, which remember, they're managing roughly $11.6 trillion. They won't tokenize all of it at once. That's not realistic, but 5%? That's doable. The question is, what would they back that 5% or $580 billion worth with? It could be U.S. Treasuries. It could be some form of dollars, but it could be a lot of things. But let's imagine BlackRock takes a conservative approach. And they take 20% of that 5%, which is $116 billion. So it will need $116 billion worth of XRP on chain, which dividing $116 billion by the 59.2 billion XRP outstanding equals about $1.96 of incremental demand per token. Add that to today's $3.19, and you're looking at roughly $5.15 per XRP. But let's take it a step forward. The base case, not conservative, but maybe something more realistic. What if BlackRock backs 50% of that pilot program in XRP? That's $290 billion. And the math comes out to about $4.90 extra per coin. Stacking that on top of today's price would put it at roughly $8.09. But now let's imagine a dream case scenario. Let's say the rumors are true and they put 100% of that $580 billion pilot program and they fill it with XRP demand. That would imply an additional $9.80 per token. Layer that on top of today's $3.19 and you land somewhere around $13 per coin. Now keep in mind, this is just institutional tokenization demand, which alone pushes it between $5 to $13. When you then factor in continued ETF inflows from Canada, the potential approval of U.S. ETFs, growing real USD powered ODL volume out of the Genius Act and on-chain accumulation by whales and other investors, the potential of other bank partnerships and even getting their own banking license, and you can see that the path could be much, much higher. But having said all that, this is where I want to balance out the rest of this video's excitement with bringing it back to reality. Because a lot of times in crypto, we're effectively placing a bet that everything from here on out will play out exactly as we hope it will. And in crypto, that rarely ever happens. And there are some risks that you should be aware of. And the first risk is this video and listening to price predictions. I've seen price predictions as high as $2,000 by 2026, which I think is just super unrealistic. That would mean the market cap would exceed $100 trillion, which would make it about as big as the stock market of the entire world. Now, I know that market caps are not as directly applicable to settlement layers and network effects, but there is still some logic there. So please don't listen to price predictions and always consider the risks. Like another major risk, for example, is that the XRP ledger might never become the go-to platform for tokenization on the scale that we'd like it to. Take Robinhood, for example. They are using two blockchains for their tokenized assets, Arbitrum and their own Layer 2 blockchain that is based on Ethereum. Now, that's Robinhood. They are not crypto experts. It might have even made more sense for them to partner with the real experts, but they still opted to build their own system instead of outsourcing to a third party to trust. Now, then ask yourself this question. Why would a giant like BlackRock partner with anyone when it could just spin up its own ledger and keep every layer under its own control? Institutions prefer full ownership of their rails rather than using a third party. So that BlackRock pilot program we talked about could end up on another custom blockchain of their own instead of the XRPL. So, yes, all of this is possible, but as of right now, I think it's highly improbable. But here's another major risk to consider. Put yourself in the shoes of a central bank or a country. Let's say you want to move a billion dollars of a tokenized commodity to another country, whatever it is, whether it's wheat, oil or gold, right? Why on earth would you want to use any cryptocurrency of any kind when they swing 10 percent in a day? If you're sending a billion dollars to the United States, they better receive a billion dollars and not a penny less. And that's exactly why stable coins will dominate that space. And Ripple's real USD stable coin or another government issued one will do those transfers instead of any cryptocurrency. Now, that might still be good for Ripple the company, but time will tell if it's any good for XRP the cryptocurrency and therefore XRP investors. There's a very big difference between the two. And even though there's no denying that Ripple has built a very valuable rail system, how it's going to translate to the cryptocurrency has yet to be proven. So anytime you hear predictions of one hundred dollars or one thousand dollars, yes, it's possible. But in order to get there, we need a lot of assumptions to come true. And then on top of those assumptions, we need to layer another 10. In contrast to Bitcoin, for example, now that it's over one hundred thousand dollars, that's only about eight to ten X away from a million, which is still an amazing return. But it's not the same moneymaker back when it was just a thousand dollars. There was a much bigger opportunity back then because there were more assumptions that had not come true just yet. But now that there are less of them on Bitcoin, the reward has been compressed. Don't be wrong, though. Even Bitcoin has its mythical narratives about how it's going to demonetize global assets and eventually become the base reserve currency of the future when AI is going to take over the world and there'll be 13 million a coin by 2040. Now, that's cool if it's going to happen. But there's a lot more assumptions that need to come true first, which is why it's nowhere near where people think it will be right now. That's why as much as I believe and invest in this stuff, even Bitcoin for me is no more than 20 to 30 percent of my net worth. It's something, but it's not everything because I try not to treat investing like I'm rooting for a sports team. But here's arguably the most important takeaway, and it's a lesson that I learned from making a very big mistake. Keep in mind, this is like 2017, Andre, but I once put a big part of my savings into a cryptocurrency I thought would a thousand X and it never did because, of course, it didn't. So I lost a huge chunk of money chasing that home run. But looking back at it, though, I realize now that I only needed to invest just enough that if the story came true, I could turn my savings into a million dollars, life changing money, but not life ruining if it failed. Because think about it. Missing out on the profits from a million dollars to five million dollars or from five million to 10 million. It's not a huge lifestyle upgrade, but the downside of losing my entire savings could be catastrophic. That asymmetry is the key. It's so counterintuitive, but big upsides don't require risking everything. In fact, they require risking less. Now, I'm not saying don't chase your dreams. Crypto is where a lot of money can obviously be made. Just don't mortgage your house to do it or use up all your savings. And if you come across a video with a million views predicting something and it's exciting, please do your own research first. Make small, smart bets, diversify and only risk what you can afford to lose. So smash that like button if this made sense to you. Subscribe if you haven't already. I'd love to see you back here next week. I'll see you soon. Bye bye.