XRP Ripple is About To Go BIG Under Trump

Next Monday, Trump will start his new term. And XRP is positioned better than most to benefit. It’s one of the cryptos Trump accepted for campaign donations for one thing.

And CEO Brad Garlinghouse has already met with Trump to talk about crypto policy. Could a Trump term be the beginning of a parabolic move in XRP? Let’s check more about Ripple.

Axis of American Crypto Companies

Trump has already said he wants to make taxes on profits in holding US-based cryptos tax-free. Coinbase stock is up almost 50% from $179 to over $250 since Trump won the election. And if they had a token, it would be doing even better.

Still, Coinbase is one of the “axis of American crypto companies”. The other big ones that should benefit from this policy or Trump just even talking about it are:

• Hedera Hashgraph.
• Cardano.
• Algorand.
• Ripple.

If Trump makes good on this promise, you have an instant increase in value for every US-based crypto project from Coinbase to Uniswap. And thanks to the SEC case winding down, XRP benefits more than most. As a crypto investor, what are you most looking forward to seeing the Trump administration do? This tax policy? Clearer regulations? Bitcoin reserve? Let us know in the comments below.

SBI Holdings

SBI Holdings is one of Japan’s biggest financial service companies. They currently own 8% of Ripple Labs. They are HUGE XRP backers for cross-border transactions, as you can see here. SBI’s 8% stake in Ripple has an estimated value right now of 1.6 trillion yen or almost 10.2 billion dollars. That’s 30% more than the entire market value of SBI at 1.2 trillion yen.

It’s pretty easy to see why SBI would be so bullish on XRP given these numbers. It also means that one of Japan’s biggest companies is trading a value smaller than its largest investment. It’s like buying their XRP stake and getting the rest of SBI at a negative market value.

It’s crazy when you think of it. If the rest of SBI makes any profit at all, you are getting all of that profit and cash flow for better than free. They are paying you. The Ripple investment is worth 1.6 trillion yen and the rest of SBI is worth -400 billion yen. That’s the difference between the 1.2 trillion for SBI and Ripple’s investment value.

And look at their income statement, their net income for the last year was 113 billion yen or 720 million dollars. And SBI is paying you to give you that cash flow. It’s nuts. So one of SBI’s money managers suggested a strategy to monetize some of this Ripple investment to unlock value for shareholders.

And that strategy is one you are familiar with. The Microstrategy Strategy. Before we get into it, are you part of the XRP Army? Let us know in the comments below.

The MicroStrategy Strategy

So for most of you, you are already aware that Microstrategy (MSTR) is Michael Saylor’s publicly traded tech company.  They operate on a Bitcoin standard. This means they use their Treasury of US dollars to buy Bitcoin to hold regularly and for the long term.

MSTR also issues bonds OR potentially issues more shares of stock specifically to acquire Bitcoin. Shareholders are voting on whether to increase the number of shares right now. So, what does this have to do with XRP? Saylor is unlocking value in MSTR shares with his Bitcoin holdings. And SBI is going to start doing the same by buying more $XRP.

SBI is going to buy more $XRP in the market and maybe even issue bonds or more shares to do so. Just as Saylor has done with Microstrategy. The idea is simple. SBI’s investment in Ripple Labs is worth so much more in market value than the entire negative value of the rest of SBI, that it does not make sense.

SBI is profitable on its own. We showed you that. But SBI’s market value will more accurately reflect the value of their Ripple holdings AND the rest of their business with this strategy. That’s the goal anyway. The idea that SBI is paying you for a company that earns $720 million means the market is way off on the company’s value.

And it could create the same type of flywheel that MSTR and Bitcoin have where each is helping to increase the price of the other. It would be just the beginning of potentially billions in institutional investment coming into XRP.

Disclaimer

The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.