Opinion: XRP is being underestimated by the market

Author: Bayberry Capital

Translation: Deep潮 TechFlow

The market continues to misjudge XRP because it has not truly understood what it is evaluating. It sees only a token but overlooks the system behind the token.

For years, the market has been measuring XRP with the wrong indicators. Traders focus on volatility, analysts chase headlines, but neither has delved into its infrastructure. XRP is not an entertainment tool; it is a financial instrument designed to transfer value within a global system with precision, finality, and neutrality. Its price has not yet reflected its functionality because the world has not yet assigned proper value to this functionality itself.

The market has yet to master how to evaluate infrastructure

Infrastructure is always misunderstood in its early stages. Investors tend to chase obvious growth while ignoring the foundations supporting that growth. The same dynamic played out during the early days of the internet. Back then, companies building routers, networks, and data centers had stagnant stock prices, while speculative capital flooded into internet companies with no real output.

Only when these infrastructures became indispensable did capital flow back to the true builders. Today, XRP is in a similar position. It is the underlying pipeline for the future financial era. The market sees a calm price chart and mistakenly considers it insignificant. In reality, what the market witnesses is the slow formation of an invisible network that will become a crucial pillar of global liquidity in the future.

Few understand XRP’s true function

XRP was not designed to be a speculative asset; its mission is to serve as a bridge asset connecting isolated financial systems. XRP enables liquidity to flow freely between different currencies, payment networks, and tokenized assets. Achieving this requires widespread institutional adoption, clear regulatory frameworks, and deep technological integration. These processes take years to develop, not just a few weeks.

The market cannot price what it does not understand. It still compares XRP to speculative assets driven by narrative cycles, but in fact, XRP’s entire architecture is monetary, not promotional. The longer this misunderstanding persists, the greater the potential for revaluation once its utility becomes the focus.

Liquidity utility and market sentiment are fundamentally different

The path to utility is entirely different from market sentiment. The growth of liquidity infrastructure is quiet and steady until it reaches a systemic critical point. At this stage, existing supply cannot meet demand, and prices will rapidly adjust to reflect the new utility value.

Most traders have never seen this happen because it is opposite to the drivers of retail markets. The true adoption process is slow, silent, and ultimately definitive. When financial institutions settle real transactions through distributed systems, this liquidity does not diminish; instead, it deepens over time. XRP’s stability is not a weakness but a true reflection of its current stage.

Debates over supply overlook key issues

Critics often focus solely on XRP’s total supply as the measure of its potential, but this is not the full picture. What truly matters is the effective circulating supply relative to practical demand. Large amounts of XRP are locked in custody accounts or held long-term; the actual circulating supply used for global settlement is much lower than the surface number.

As transaction volumes increase, velocity accelerates, and available liquidity tightens. The compression of this circulating supply, combined with growing demand, will lead to genuine price discovery. This is not speculation but a mechanism at work.

Regulation lays the groundwork for utility

Traditional financial markets typically incorporate regulatory considerations into their pricing before regulation arrives, whereas in the digital asset space, regulation is often viewed as an afterthought. However, as XRP’s legal status becomes clearer, this regulatory clarity is a milestone. It transforms XRP from a legal risk into a compliant bridge mechanism that banks and institutions can actually use.

The market has yet to adjust to this shift, still trading XRP as a marginal tool rather than as a recognized financial conduit. This misalignment is one of the most significant asymmetries in today’s digital asset landscape.

The upcoming wave of tokenized value

The world is on the brink of a new financial structure where real-world assets will be recorded on ledgers. Bonds, sovereign debt, currencies, and commodities will all be tokenized and exchanged digitally. For these systems to interoperate, a neutral bridging asset capable of settling across networks is essential. XRP was designed precisely for this purpose.

As tokenized trading volume expands, bridge liquidity will become a new “oil” of the global financial system. The flow of each on-chain asset will drive demand for a neutral settlement medium. This demand is structural, not driven by speculation, but by actual needs.

The low-profile nature of institutional integration

True adoption often happens quietly. Ripple and its partners operate within regulated environments, prioritizing reliability over publicity. Pilot channels, enterprise solutions, and liquidity partnerships are usually developed and tested privately, only scaling when fully functional.

Retail markets seek public excitement, while institutions focus on certainty. The infrastructure being laid today will only be reflected in prices when it becomes a critical part of operations. By then, the market will realize that the years of silence were actually a process of building.

Perspective shapes perception

The difference between speculators and investors lies in whether they can see beyond the present and foresee the future. XRP’s current market cap appears large compared to other digital assets, but when measured against the projected scale of global settlement volumes, foreign exchange flows, and tokenized assets, it is insignificant.

This mispricing stems from the market still viewing XRP as a speculative asset rather than a transformative one. It is valued like other cryptocurrencies, not as a foundational monetary infrastructure capable of facilitating trillions of dollars in global movement. When the focus shifts from price charts to liquidity mechanisms, valuation models will change fundamentally.

XRP is undervalued because the market still sees it as an event, not a system. It has yet to realize that value accumulation within the financial architecture is slow but will explode once mature.

When distributed settlement systems become the norm rather than an experiment, XRP will no longer need promotion or defense; its utility will speak for itself.

At that point, the market will not discover a new asset but will recognize an asset that has long existed—quietly laying the groundwork for the next generation of value transfer.