Prediction: This Will Be the Cryptocurrency XRP's Price by Late 2027 (Hint: It's a Big Move)

On July 23, Ripple announced an important new product, Ripple Mint. It's a platform that lets banks and trading firms create and cash in RLUSD, the company's dollar-backed digital token. And it's a serious piece of plumbing for the company behind XRP (CRYPTO: XRP) -- it also has very little to do with XRP.

This is part of a pattern that's becoming hard to ignore: Ripple is continuing to expand its reach in global finance, but primarily through RLUSD -- not XRP. And that means the token's price continues to fall.

I think this will continue, and my call is roughly $0.60 by late 2027. Let me explain.

The original case for XRP is falling apart

For more than a decade, the basic case for XRP rested on the idea that as banks around the world adopted Ripple's products, XRP's value would steadily increase. More banks meant more demand.

If you ask me, this thesis was always weak -- I think the demand effects were never as large as people believed -- but even if you assume it's true, it matters less and less.

The fact is, RLUSD is replacing XRP as the preferred asset for banks. XRP is being sidelined. And it makes a lot of sense. If you are a bank, do you want to interact -- or hold -- an asset as volatile as XRP? Banks are risk-averse by their very nature, and the need to use XRP stood in the way of Ripple's expansion. That is, until it introduced RLUSD.

Image source: Getty Images.

A stablecoin like RLUSD is a digital token pegged to a currency, in this case, $1 per token. That means, just like the name clearly spells out, they are stable. Banks love stable.

What Ripple Mint tells us about XRP's future

I think the Mint announcement perfectly lays out what I am talking about. While the company says Mint will bring "value and activity back to XRPL infrastructure," it's only mentioned after going into serious detail about all the ways institutions can interact with RLUSD and use it to enhance their operations.

In this major announcement, XRP is -- in my opinion -- an afterthought. The company says it will serve as a "complementary" asset to RLUSD. That seems like a clear demotion from the old pitch.

My price target: $0.60 by late 2027

Look, crypto is famously hard to value, and I cannot say I'm confident $0.60 is exactly where XRP will land by late 2027. I am confident, however, that its long-term outlook is not good.

There will be some ups and downs along the way -- wild price swings higher are not out of the question -- but over time, I think XRP will be trading lower than it is today, regardless of Ripple's or RLUSD's success.

Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends XRP. The Motley Fool has a disclosure policy.