Top Manager Sees XRP as Undervalued Opportunity

What to Know:

• Portfolio manager Michael Gayed, known for his macro views and ETF analysis, has expressed interest in XRP, signaling potential institutional attention.
• Gayed’s interest coincides with increasing inflows into XRP ETFs, nearing $1 billion, suggesting growing institutional adoption.
• Despite ETF inflows, XRP’s price hasn’t significantly reacted, hinting at a possible supply shock and future price appreciation.

XRP has long been a focal point for retail investors, but recent signals suggest a shift in institutional perception. Michael Gayed, a portfolio manager known for his ETF research and macro insights, has publicly expressed interest in XRP, marking a notable departure from his previous focus on Bitcoin and gold. This development, coupled with substantial inflows into XRP ETFs, suggests a potential re-evaluation of XRP’s role in the evolving digital asset landscape by institutional players.

Gayed’s XRP Overture

Gayed’s recent activity, including a tweet hinting at an XRP-related move and the release of a song dedicated to the XRP community, has sparked considerable discussion. While seemingly unconventional, this public display of interest from a respected market commentator could signal a deeper analysis of XRP’s fundamentals and potential. Gayed’s previous criticisms of Bitcoin ETFs and gold suggest a discerning approach to asset evaluation, making his interest in XRP all the more noteworthy.

Institutional Inflows and ETF Dynamics

The surge in inflows into XRP ETFs, approaching $1 billion, provides tangible evidence of growing institutional interest. These inflows, led by firms like Bitwise and Grayscale, indicate a willingness among traditional financial players to allocate capital to XRP through regulated investment vehicles. However, it’s important to remember the relatively small size of crypto ETFs compared to the broader ETF market. Brad Garlinghouse’s observation that crypto ETFs represent only 2% of the global ETF market underscores the potential for further growth and integration.

Price Discovery and Supply Dynamics

Despite the significant ETF inflows, XRP’s price has yet to reflect this increased demand. This divergence between inflows and price action suggests a possible imbalance between supply and demand, potentially leading to a future supply shock. Market observers like Jake Claver and Zach Rector anticipate a “violent” reprice as ETF inflows continue to accumulate XRP, reducing the available supply on exchanges. Such scenarios have played out in other markets, where increased institutional participation eventually led to significant price appreciation due to limited supply.

Regulatory Clarity and Market Confidence

XRP’s journey has been marked by regulatory uncertainty, particularly the SEC lawsuit against Ripple. However, recent developments, including the court’s decision that XRP is not a security, have provided some clarity and boosted market confidence. This regulatory progress, combined with increasing institutional interest, could pave the way for broader adoption and integration of XRP into traditional financial systems. The outcome of the ongoing SEC case remains a key factor, as any further clarity could significantly impact XRP’s long-term prospects.

Tokenization and Real-World Asset Settlement

One of the key narratives driving institutional interest in XRP is its potential role in tokenization and real-world asset settlement. XRP’s speed and cost-effectiveness make it an attractive option for facilitating cross-border payments and settling transactions involving tokenized assets. As the tokenization of real-world assets gains traction, XRP could emerge as a critical infrastructure component, further solidifying its institutional relevance. This potential use case distinguishes XRP from other cryptocurrencies that are primarily viewed as speculative assets.

In conclusion, Michael Gayed’s interest in XRP, coupled with rising ETF inflows and regulatory progress, suggests a potential shift in institutional perception. While XRP’s price has yet to fully reflect these developments, the underlying dynamics point to a possible supply shock and future price appreciation. As XRP’s role in tokenization and real-world asset settlement becomes clearer, its institutional relevance is likely to grow, positioning it as a key player in the evolving digital asset landscape.

Related: XRP Dips, Traders Eye Key $1.90 Support

Source: Original article