Topic: XRP Market Cap May Be $6.1 Billion Overstated - Unqualified Opinions (Read 99 times)

I read in this thread that Ripple will die - https://bitcointalk.org/index.php?topic=3221282.new#new
And then I wanted to read Ripple's tech, and its Quarterly report. After looking after lot of threads


If history is a guide, Ripple is due to disclose its Q4 2018 transparency report as early as today. In advance of that report, we conducted extensive research into the health and legitimacy of the currently quoted XRP "market cap” available on third party crypto data services and exchanges. We believe the figure is significantly overstated; potentially by as much as $6.1 billion.

Ripple’s Market Cap Is Likely Overstated by $6.1 Billion

If history is a guide, Ripple is due to disclose its Q4 2018 transparency report as early as today. In advance of that report, we conducted extensive research into the health and legitimacy of the currently quoted XRP "market cap” available on third party crypto data services and exchanges. We believe the figure is significantly overstated; potentially by as much as $6.1 billion.

We have reached out multiple times to Ripple representatives for comment, but have not yet received a response to our inquiries. We acknowledge that some of the estimates in this report lack precision, but believe they are directionally correct, and presented in good faith. We look forward to Ripple’s response, and will update this report accordingly if and when they do reply.

Summary:

+ XRP’s liquid “circulating supply” and “market cap” could be overstated by 46%, which would put total XRP “market cap” at $6.9 billion vs. $13.0 billion widely reported at current USD-XRP exchange rate.

+ We recommend major indices, including Bloomberg-Galaxy, MVIS CryptoCompare, and the Bitwise 10 Large Cap Crypto Index, and others, as well as passive funds such as Grayscale’s Digital Large Cap, and Bitwise’s 10 Private Index Fund, review this report and reach out to us with questions regarding our methodology. (Our API documentation is available for review.) Pursuant to this report's finding that the true liquid market cap of XRP is significantly lower than previously reported, index weightings of XRP should likely be reduced. We do not believe reliance on Ripple’s XRP data API can be expected to yield accurate circulating supply figures in light of these findings. However, a more precise estimate of XRP supply will likely require proactive disclosures from Ripple, given the contractual restrictions the company has placed on a large percentage of its XRP resales.

+ In addition to the 59 billion XRP owned by Ripple and held on the company’s balance sheet (52.5 billion in long-term escrow, and 6.5 billion illiquid, but available for restricted sales), there could be significant, persistent sell-side pressure in the XRP market depending on the length and structure of selling restrictions placed on Ripple’s market making partners, a Ripple affiliated foundation, and Ripple’s co-founders, all of which appear to have negotiated rate limits for sales based on exchange trading volume of XRP.

+ Ripple has not shared the methodology or reference exchange data it uses to calculate trading volume for XRP, a critical data point that drives selling restrictions. More than 99% of XRP trading volume appears to come from overseas exchanges, many of which have been suspected of wash trading. We urge Ripple to disclose its volume-based selling methodology, as well as the amount of XRP subject to contractual volume-based selling limitations over time. This is necessary in order to help investors better understand the inflation and selling pressure in one of the industry’s largest assets, and is necessary to protect consumers and promote fair and efficient crypto markets.

+ A snapshot comparison of our circulating supply estimates vs. Ripple’s highlight the drastic difference between our deep dive and the company’s proposed statistics:

Read more - https://messari.substack.com/p/xrp-market-cap-may-be-61-billion