XRP Market Cap Misunderstanding Fuels Unrealistic Price Targets

XRP's market capitalization has long been cited as a limiting factor in its potential price growth. However, according to crypto commentator and developer Bird, this reaction is based on a misunderstanding of how market capitalization works.

Bird explained that market cap is calculated by multiplying the last traded price by the circulating supply, but this figure does not represent the amount of money invested in an asset. Instead, prices are determined at the margin, meaning relatively small amounts of new capital can increase an asset's overall valuation significantly.

Bird believes that XRP should be evaluated based on its long-term growth potential rather than its current market cap. He envisions a future where the XRP Ledger supports trillions of dollars in tokenized real-world assets, including government bonds, corporate debt, equities, and more.

This transformation would make XRP a major financial ecosystem used by institutions, businesses, developers, liquidity providers, and investors. As such, its value would no longer be solely derived from speculative trading but rather as the native asset supporting this large financial infrastructure.