Following last month's favorable ruling in an SEC vs Ripple lawsuit, the cryptocurrency XRP saw a positive performance in the first two weeks, surging 76% immediately after the announcement of the ruling. That surge hasn’t abated for a cryptocurrency that has already established itself as a key player in the crypto market.
With a market capitalization of just over $33 billion, XRP currently ranks fifth and has been one of the top cryptocurrencies for close to 13 years.
The XRP coin was developed by Ripple Labs. XRP is not just a cryptocurrency. Overall, it is a major crypto initiative aiming to revolutionize how money is transferred globally.
Ripple wants to provide an efficient and cost-effective alternative to the current SWIFT banking system that anchors the global banking infrastructure. Through XRP, Ripple wants to facilitate faster and low-cost international financial transactions to create an environment where transferring money will be as simple as sending an email.
Like other cryptocurrencies, XRP aims to eliminate the middleman and centralized control or mediation of financial transactions, a role currently played by banks in the global financial system. XRP enjoys a cult-like following in the crypto community although it has also been a divisive crypto project over the years.
The Price History of XRP
To help us know the potential of XRP, it is important to look at its price history over the past decades, including trends and indicators that can provide guidance to current investors. So far, XRP price has been characterized by highs, steep falls as well as extended periods of steady decline.
The XRP token was launched in 2013 but it only began seeing considerable price action during a bull run in 2017. Following the bull run, listings on popular exchanges became key to XRP’s major price rises.
XRP has been listed in cryptocurrency exchanges since 2018 which was a watershed year for Ripple, the crypto company behind the XRP cryptocurrency. Ripple’s launch of its xRapid product was pivotal and brought forth a new era where its XRP cryptocurrency sought to transform money transfer, not only outside the conventional banking system but also within it. XRP received a phenomenal market response and has seen tremendous growth over the years, to its current position as the fifth-largest cryptocurrency by market capitalization.
Shortly following its listing, XRP price shot up by up 1820%. Its price rose from a mere $0.2 to $3.84 when it hit an all-time high, generating considerable excitement among investors. After it skyrocketed in price, it soon plunged 93% in just a few months.
During the crypto bull market run in 2021, XRP rose again, giving some savvy investors handsome returns when it rose 710% to hit $1.96.
In the 2022 market crash, XRP plunged again, declining to just $0.3.
XRP’s price has been recovering recently. The recent favorable court ruling in the SEC vs Ripple lawsuit energized the crypto and saw its value rise by over 78% overnight to hit $0.80 though it has since fallen to $0.63 as of the time of writing (early August 2023).
These price shifts are important as they demonstrate the reactive character of cryptocurrency markets. Any news, be it good or bad, can considerably sway investor sentiment and even the price of the cryptocurrency itself, by extension.
The history of the XRP price is an indicator of the volatile, dynamic nature and usually unpredictable nature of cryptocurrencies. Although the past is not necessarily an indicator of the future performance of the cryptocurrency, it also can also provide important insights that can inform investment decisions.
What is the Prognosis for XRP in 2023?
Following Ripple’s recent court success in the SEC lawsuit, some new crypto investors are giving XRP serious thought. The court ruled that the sale of XRP tokens via exchanges and algorithms did not constitute investment contracts but the institutional sale tokens violated federal securities laws.
What will be the future of Ripple’s XRP in 2023? Will its price skyrocket like in the previous years during the crypto boom? Prediction is difficult, especially of the future. Like other cryptocurrencies, investment in XRP is still fraught with risks and it is difficult to forecast with some certainty where the price will go from here.
Ripple’s partial resolution of its disputes with the US Securities and Exchange Commission at the courts may give XRP some traction and see its price rise in the coming months. The legal battle against SEC was pivotal in XRP’s price performance and the lawsuit was watched closely by the wider crypto community and investors.
While the community and investors are now bullish, it is important to tread cautiously as the dispute is not yet fully resolved. In spite of the positive news from the law courts, it is still difficult to accurately predict the future trajectory of XRP.
Crucially, investors must endeavor to understand the correlation between these legal resolutions and market performance. Should the disputes with the SEC be resolved favorably, we could see a spike in interest in XRP in the coming months and this is likely to power new growth and a rise in the XRP price.
At this juncture, these are merely projections and not solid indicators of future XRP performance. They show a potential growth path of the XRP in 2023 and beyond but they are certainly not a definitive guarantee that investors can run with. The performance of the cryptocurrency will, to a large extent, depend on the final conclusion of the SEC dispute as well as on the performance of the cryptocurrency market in the next few months.
What to Expect of XRP Price Performance in the Coming Months
Cryptocurrencies are, undoubtedly, some of the most volatile asset classes. Trying to predict the future trajectory of a cryptocurrency isn’t too different from trying to forecast the weather. When it comes to the crypto market, there are always a lot of variables at play. Some of these are predictable and others less so.
XRP has been subject to numerous price predictions over the years. A prediction by crypto hedge fund manager Thomas Kralow forecast that XRP would hit $30 by 2023, even though this is mathematically improbable given that with a circulating supply of 100 billion coins, XRP would have a market cap of $3 trillion at that price. This would be more than the current $1.5 trillion for all the current cryptocurrencies combined, a tall order by any measure.
A more paired-down prediction of XRP price performance factors in the bullish outlook of the cryptocurrency market at the moment which has been triggered by a positive legal outcome, increased XRP popularity, a bearish view, as well as a potential decline in interest. This will also be impacted by token design along with broader market sell-offs. Such a prediction would give a less sensationalist figure that is likely to be closer to the actual performance in the coming months.
The Case for a Bullish Market
Like stocks in traditional financial markets, the prices of cryptocurrencies are subject to factors such as news, popularity, and even court decisions like in the XRP case.
Cryptocurrencies do not have any intrinsic value. Their values are, thus, completely dependent on investor sentiment.
Ripple’s recent triumph in the court was interpreted as a positive signal by investors and it had the desired ripple effect within 24 hours of the announcement of the court ruling with the cryptocurrency rising in value by more than 78% during that period. The court ruling created positivity around the cryptocurrency which is, in turn, having a positive impact on its growth.
XRP’s price could get an additional boost from other favorable rulings and developments in relation to the current litigation.
Apart from the legal impact, the price of XRP will also be impacted by the general state of the cryptocurrency market at the moment. If the market sees a large upswing in the coming months, it will have some ripple effect on the price of XRP whereby the cryptocurrency will be essentially riding the wave of that crypto boom.
The Case for a Bearish Crypto Market
The bullish market trend may not necessarily suffice and we might as well see a bearish market trend. Paradoxically, the resolution of the current SEC vs Ripple litigation may end up causing a decline in XRP price as we are already seeing.
The initial excitement generated by the resolution may subside followed by a drop in interest in XRP. In the medium term, this could depress the XRP price. The price currently stands at $0.63 following an initial burst that drove it past $0.80.
There are other possible challenges in the broader market. If we see a considerable sell-off in the cryptocurrency market, the XRP price could drop. XRP is likely to rise with a bull market, but it could equally drop with a bearish market trend in the broader cryptocurrency market.
Concerns have also been raised over the use of XRP in Ripple’s broader cross-payment ecosystem where the currency is pretty much redundant and is probably not necessary for the payments system to work. Even if XRP is used in settling payments, the value of the cryptocurrency will not affect the functionality of the system because the payments are settled in fiat value. The payments will be sent normally irrespective of the value of XRP.
As a result, the long-term value accrual of XRP can be perceived through a significant improvement to the design of the token as well as its utility in the system.
Does XRP Make for a Good Investment?
Careful thought should be given to investments in cryptocurrencies such as XRP. The latest events indicate the cryptocurrency will have a positive outlook for the rest of the year. There is also the prospect of a new bull market that will positively impact most cryptocurrencies, including XRP. However, in spite of the sunny outlook, there are still risks associated with an investment in XRP.
In the near future, we will likely see a surge in interest in XRP which will drive a new uptrend. The potential resolution of the current litigation also adds to the positive outlook and forecasts.
However, we cannot discount the possibility of wild swings in prices and unpredictability inherent in the cryptocurrency market. An XRP investment is still a risky bet and may not be suited for most investors. Cryptocurrencies are generally characterized by high price volatility and unpredictability. It is close to impossible to predict future trends in this kind of market.
Prospective investors must, therefore, factor in their own risk tolerance as well as financial goals. There is an attractive potential for high returns in cryptocurrency investments. However, there is also the real prospect of major losses due to the volatile nature of these assets.
Crypto investors must make their investment decisions with an appreciation of the risks entailed. While some investors will see cryptocurrency investments as a great opportunity, it may not suit the risk appetite and investment strategy of others.
Before plunging into XRP investments, do thorough research about the prospects of cryptocurrency and consult seasoned cryptocurrency investors.