With a dedicated army of holders and a price near $2.40 as of March 20, XRP (XRP -0.29%) has a good shot at reaching $3 and beyond, especially over the long term.
As if the coin’s bulls don’t have enough reasons to be excited, there are two new signs that its value is more likely to increase than decrease. Here’s what was just revealed.
New offerings could make for big tailwinds
Per a new trademark application filing dated Feb. 25, Ripple, the company that issues XRP, is likely looking to do two things that could significantly benefit the coin’s holders. The trademark pertains to Ripple Custody, which is likely the business’ new name for its cryptocurrency custody services that it offers to institutional investors that want to hold crypto assets; the services were launched in October 2024.
Therefore, it is probable that Ripple is looking to scale up its custody services under an official new banner. That could deliver it additional revenue that might be reinvested into developing new features for XRP’s chain, which is why it’s a bullish sign.
Also included in the trademark filing is language suggesting that the company will likely offer a blockchain wallet at some point. That wallet would probably accommodate holding XRP, as well as stablecoins on its chain, and perhaps even fiat currency. So it could make buying and holding XRP a bit easier for some users if it comes to fruition. But the real upside from Ripple offering a wallet is that it could capture a small fee from any action that users perform in the wallet.
An even larger, though less certain, source of upside would be if it developed wallet applications intended specifically for institutional use rather than by retail investors. In that context, capturing a sliver of fees from each transaction, billed as a percentage of the transaction’s value, would be a big cash flow over time. And that would enable it to go big with its other initiatives related to XRP, like using it as a platform for tokenizing real-world assets.
Such a strategy would in fact be the obvious next step if Ripple does develop a wallet app. If the preferred wallet for XRP can natively hold, track, and trade real-world assets, or help in loading them onto the blockchain, it would be a significant impetus for further adoption, especially among the banks and financial institutions that the chain targets.
So the company’s approach could easily pay off big for XRP over time if it pursues the right integrated strategy, given its positioning today.
There are still risks here
Time for a splash of cold water.
A trademark application filing is not the same as a completed product or a functioning service. Nor does it imply that any products or services ultimately produced and bearing such a trademark will be well-constructed or of interest to any target demographics. There is no guarantee of XRP gaining in value, even if Ripple ends up offering in-demand custody services or producing a wallet that a lot of people use.
Furthermore, Ripple generating fresh revenue and choosing to reinvest that revenue into improving the features of XRP’s chain does not make it certain the coin’s value will rise in the short run. There is also not much reason to hope that the volatility of the asset will moderate if the custody services are in high demand or if the wallet app is a hit, assuming it’s ever made. So the coin isn’t about to become a source of comfort for those who were jittery before.
Nonetheless, over the long run, consistent improvements to the chain, as well as adding new users and organizations, will probably lead to higher prices, and surpassing $3 is not a very ambitious target at all from the perspective of the coin’s potential pricer five years from now.
For now, these two new bullish signs are a bit too preliminary to invest on. Once there’s a bit of confirmation of Ripple’s plans, however, it should be a green light to load up on XRP, signaling an even stronger future for the coin.
Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.
