Jeff Dorman, Chief Investment Officer at digital asset firm Arca, offered a framework for evaluating the true worth of crypto assets, arguing that value in the space is far more nuanced than just price movements or hype.
According to him, crypto assets derive value from three main sources: financial, utility, and social. Financial value refers to revenue generation or token-based cash flows. Utility value reflects how useful the token is within its network or platform. Social value, meanwhile, is based on community backing and user loyalty.
Dorman explained that the best crypto projects should ideally combine all three value types, though even one or two can still be meaningful. However, he warned that social value alone—while powerful—isn’t enough without a path toward monetization or broader real-world utility.
Using XRP as a case study, Dorman described the token as “insanely overvalued,” pointing to its market cap of around $131 billion despite lacking strong financial or utility fundamentals.
He emphasized that XRP’s value today comes largely from its long-standing brand and loyal community, adding, “It’s not worthless—I just can’t define its worth. It’s like a very expensive call option on what it could be.”
He also compared XRP to GameStop, suggesting both assets have been driven primarily by community enthusiasm. But he noted that momentum, if directed effectively, can eventually translate into tangible value—citing GameStop’s ability to raise capital and purchase Bitcoin as an example.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/xrp-might-be-hugely-overvalued-but-still-has-long-term-potential/