Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. A fresh debate in the crypto space has emerged over whether the cost of production significantly impacts the XRP priceand the value of Bitcoin (BTC). Market expert CrediBULL Crypto has outlined how these costs influence XRP’s value compared to Bitcoin, concluding that both cryptocurrencies follow the same pricing formula. XRP Price Formula Mirrors That Of Bitcoin
A recent discourse on X social media has reignited discussions on whether production costs play a decisive role in determining the prices of cryptocurrencies. CrediBULL Crypto weighed in, explainingthat both Bitcoin and XRP follow the same fundamental pricing model, where the cost to produce, combined with speculative and utility value, determines the market price. Related Reading Analyst Outlines How Production Cost Determines XRP Price, But Is It Better Than Bitcoin? 4 hours ago
For Bitcoin, the analyst notes that the cost to mine, taking into account energy consumption and time, represents a significant portion of BTC’s market price. This production cost forms the “X” variable in the analyst’s pricing equation, with the remainder driven by speculative demandand utility.
In contrast, CrediBULL Crypto highlights that XRP’s production cost is negligible, arguably near zero, meaning its market price is primarily driven by demand, adoption, and other speculative factors. Whether mined or premined, the analyst asserts that the market ultimately assigns a value above the production cost based on perceived utility and shifts in investor sentiment.
CrediBULL Crypto’s statement comes in response to a recent clash between market expert BD and Robert Breedlove, a Bitcoin maximalist. In his post, Breedlove suggestedthat XRP’s “100% premined” status set it apart from Bitcoin, which he asserts is a 0% premined coin. The Bitcoin maximalistalso warned investors of the potential consequences of this difference, subtly implying that XRP could be a scam token.
BD countered, asserting that market demand, not production method, dictates price. He further emphasized that neither mining costsnor premined supply inherently determines a cryptocurrency’s long-term value. Demand Dictates Long-Term Survival
Following CrediBULL Crypto’s statement, a community member arguedthat premined assets, like XRP, could carry higher risks, such as large-scale sell-offsor “rug pulls,” potentially driving their value to zero. They further suggested that BTC’s mined supplystructure offers more protection against such scenarios.
CrediBULL Crypto, however, pushed back, statingthat production costs do not guarantee long-term survival or resilience. He noted that demand can disappear for any asset, regardless of whether it costs $5 or $100 to produce. He added that the same principle also applies to Bitcoin and XRP, which are respectively priced at $116,601 and $3.34, at the time of writing. Related Reading Analyst Predicts Historical 90% XRP Crash Against Bitcoin, But This Will Happen First 1 week ago
The analyst further pointed out that just because a commodity costs money to produce does not make it inherently valuable. Without sustained interest, even a high-cost-to-produce asset could collapse in value. To illustrate this point, the analyst compared it to investing substantial resources into digging a massive hole—a process requiring real effort but might hold no value if no one finds the hole useful. XRP trading at $3.3 on the 1D chart | Source: XRPUSDT on Tradingview.com Featured image from Getty Images, chart from Tradingview.com