Hello everyone and welcome to another article on my blog Vendata's journey of the crypto world! XRP has pumped over the past week, moving from about 0.96 USD to at the time of this article about 1.74 USD! That is almost double the price. This has stunned me and has called me to invest in XRP. Many people are promising for XRP to continue rushing up in price. Some say it will go to a plausible 2.20 USD, others are way more irrational, claiming that XRP is going to go to 500 USD!
Obviously, with a market cap of 285 million USD, it is fair to say that Ethereum will never leave its second place in the crypto market, remaining the queen of the crypto world. Now, XRP has a market cap of about 80 million USD. If XRP was to go to 500 USD, then it would be about 250 times the current price, and thus the current market cap would be 250 times as well. This calculates to 20 billion USD, which is of course out of the question! If I have to be honest, I have not a good idea of what XRP, and why it has boomed so much.
Looking at the trends of XRP's price, it seems like a good option for investment, but there is also the background of it as well which plays a significant contribution to the future price. Thus comes this article's focus: to explain what XRP, and then why it has gone up so high, followed by predictions.
What Is XRP (XRP)?
In simple words, XRP is Bitcoin but cheaper and focused on banks, payment providers and digital asset exchanges. XRP is claimed to be "the greatest digital asset of all time," being a "global cryptocurrency that has many use cases," and is "faster, more scalable, more efficient, and better of our planet when compared to Bitcoin" (source).
XRP is run by the technology company Ripple whose vision is to move value into the internet, which, however, has already been sought for. Ripple is the only enterprise blockchain that has products in commercial use with its global payments network called RippleNet, which I assume powers XRP. RippleNet consists of over 300 financial institutions across 40 counties and 6 continents (guessing Antarctica is missing!). Ripple claims to be working alongside regulators, governments and central banks to improve money circulation. In a word, it seems that XRP is Bitcoin, but in a completely different way, appearing more centralised and business-focused.
Although it sounds promising, XRP has received criticism for its projects and claims. It is claimed that there is a vagueness surrounding XRP which mean that it is difficult to pinpoint its features, potentials, projects, etc., and so indicates a negative cryptocurrency.
Why Is XRP Going So High?
A few days ago, Ripple managed to get another major win with its legal team. A federal judge exempted Ripple from being required to provide their financial records to the SEC (Securities and Exchange Commission), which most likely gave relief on Ripple's side. This passing was made by Sarah Netburn, who is the United States District Court Judge of the Southern District of New York. According to Netburn, the records were not "relevant or proportional to the needs of the case." Netburn also allowed Ripple to access SEC minutes and memos that explain why SEC has not considered Bitcoin and Ethereum securities. Ripple hopes these documents given will support XRP's case by contrasting it to the cases for Bitcoin and Ethereum, thus giving more freedom to develop for greater success.
Another possible cause for XRP's boom, which is more of a current one, is the bandwagon of XRP after it has begun to rise. Since so many people are buying XRP and promoting it to others, there is a mass exodus of people to XRP, mass transactions occurring. This booms the demand, flowing onto the price, which is why XRP is risky: there are so many people trading it so quickly, that the price moves radically, calling for potentially massive losses, but also gains. I believe XRP's high price will be short-lived that is sparked by an outburst of buys, potentially driven by the success of Ripple's lawsuit, dropping in price in due time. This is evident a few years back where XRP hit over 3 USD before falling below 50 US cents over several months.
This makes the end of this article! I hope the information is insightful and useful, answering possibly one of the most burning questions of the crypto market, brought up by the rocketing of XRP over the past week. Personally, XRP is not an over-the-top crypto project, which you would expect to rarely see in the top 10 crypto markets, rather extremely successful and purposeful cryptocurrencies. Do not get me wrong, XRP is good in several ways, but I have heard concerning issues regarding it alongside some discrepancies, and there seems to already be cryptocurrencies that already have covered its aims a long time since, such as Bitcoin.
Investigating the background of XRP, I find out why XRP has pumped up so recently, understanding more of the crypto world and market.