XRP has surpassed Ethereum in valuation, but this applies solely to their fully diluted market caps, which account for their total supplies.
Following its impressive run last November, XRP re-ignited optimism around its potential to surpass Ethereum in market capitalization. Notably, this confidence has concrete backing, as XRP has gained a massive 257% against Ethereum since November 2024.
This run brought the “banker’s coin” impressively close to overtaking Ethereum, especially after it flipped Tether (USDT) months back to become the third-largest crypto asset. However, it still needed substantial growth to surpass its closest rival. Meanwhile, the recent downturn is already putting a reset on things, with XRP now relegated to fourth position.
XRP Overtakes Ethereum in FDV
Interestingly, despite this market collapse, crypto analyst Miles Deutscher recently pointed out that XRP has overtaken Ethereum, but only on the fully diluted valuation (FDV) metric.
For the uninitiated, an asset’s fully diluted valuation accounts for its market cap when considering total supply. The metric differs from the actual market cap, which only considers the asset’s circulating supply and is a true representation of its market worth.
Data from CoinMarketCap confirms Deutscher’s claims. Specifically, Ethereum now has a fully diluted valuation of $228.9 billion at press time, considering its total supply of 120.61 million tokens and the prevailing unit price of $1,899.66 per Ethereum.
Meanwhile, in comparison, XRP boasts a fully diluted market cap of $231.18 billion, accounting for its total supply of 99.98 billion and the unit price of $2.31 per XRP. Notably, the $231.18 billion figure is $2.28 billion more than Ethereum’s value.
In simpler terms, this indicates that if all the XRP tokens were in circulation, including the ones locked in Ripple’s escrow accounts, the asset’s market cap would have surpassed Ethereum’s. It is important to note that, in contrast, all the Ethereum tokens are currently in circulation.
When Does It Matter?
However, this is not the first time XRP has surpassed Ethereum in FDV, with this feat occurring occasionally over the past few weeks. This is largely due to XRP’s increasing circulating supply, as more tokens leave the escrow accounts, as well as XRP’s impressive gains against Ethereum within this period.
Nonetheless, XRP is not the only inflationary asset of the duo. For context, Ethereum is also currently inflationary due to the implementation of the Dencun upgrade, which leads to fewer transaction fees and a subsequent reduction in the amount of ETH burned.
While XRP’s latest feat against Ethereum is not particularly noteworthy until it reflects in both assets’ actual market caps, the asset is currently in a good position to overtake ETH. At the current position, XRP price would need to rise 69% to $3.9 to surpass Ethereum’s market cap of $229.12 billion.
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