XRP has almost become a household name among crypto enthusiasts. XRP has always asserted prominence since its launch. However, XRP’s journey was not at all easy; it was a turbulent sail with price fluctuations, problems, and even lawsuits.
Even after reaching an all-time high of $3.84 during the early days of 2018, XRP went back down due to regulatory issues. To add insult to injury, XRP was delisted from some of the major exchanges, and all of this contributed to XRP’s fall to the current price.
This article will take a look at the future potential of XRP. Whether it can scale the walls it once fell over, and an even more interesting question-will it ever reach the price of $500?
What is XRP?
XRP is a cryptocurrency. This cryptocurrency was designed with the following key concepts in mind.
- Fast and Low-cost transactions.
- Ultra-easy cross-border transactions.
XRP is the native coin of the Ripple blockchain. The cross-border transaction facilitation is one of XRP’s greatest achievements as we speak of it. It does cross-border transactions as the bridge currency for several different fiat currencies.
XRP – Past Performance Analysis
As we mentioned earlier, XRP’s journey to where it is today was filled with turbulent waves of ups and downs. The 2018 crypto euphoria was one of the key events that led to XRP reaching its all-time high of $3.84.
During this ecstatic stage of the crypto journey, the market capitalization of XRP reached a whopping $139.4 billion. At the time, this meant that 20% of the entire crypto market was occupied by XRP.
But came the fall of the entire crypto domain after the euphoria, and XRP too was washed ashore during this massive crisis, plunging from its all-time high. The fall of the crypto market after the euphoria was just one of the many reasons for XRP’s fall.
A regulatory concern with the SEC was predicted before the SEC even filed the lawsuit. This was because even though XRP was tied to Ripple Labs, over 50% of the total supply was held by Ripple Labs. This made investors and potential investors fear that XRP might lose value in the future. Additionally, Ripple Labs used to occasionally sell its stock of XRP coins to fund operations. Many deemed this a regulatory violation, and soon enough, the SEC intervened with a lawsuit that further damaged the reputation of XRP.
This lawsuit and its particulars raised further questions about the credibility of XRP’s claimed decentralization. This was because most of the coins were held by Ripple Labs. Then came the problem with XRP’s validators. XRP’s validators were deemed too centralized, unlike those of Bitcoin and Ethereum.
To add further speculations to whether or not XRP was as decentralized as it claimed, it seemed that Ripple Labs heavily influenced the network’s governance. Despite all of this, XRP was supposed to uphold its value based on its retail use case. However, banks did not adopt XRP as it was hoped they would. Banks and financial institutions were interested in using the Ripple software xCurrent; however, they were reluctant to use XRP itself. As the news regarding this was spread, XRP’s popularity plunged even more. The use case that was supposed to revive XRP was deemed insufficient by investors and potential buyers.
Would XRP Be A Good Investment?
XRP’s investment potential is a decisive matter that is subject to various factors. At the forefront of these factors lies the investor’s individual risk tolerance potential. The investment goals, or what an investor is expecting from their investment in XRP, and market conditions are other factors that will determine XRP’s eligibility as an investment-worthy coin.
XRP has strong ties with financial giants of the world, such as VISA. With more incoming institutional investors and an entry into the ETF market, XRP holds the potential to perform better and reach higher prices.
However, like any cryptocurrency asset, XRP is susceptible to market conditions, investor sentiments, and market volatility, so investments in XRP should be made carefully.
Will XRP Ever Reach the $500
By taking into consideration the current market fundamentals of XRP, XRP’s past performance, the industry’s view about XRP, etc., it is highly unlikely that XRP would reach a high price like $500, at least not anytime soon.
Even though a market price of $500 is theoretically possible, several factors stand as a hindrance in XRP’s way to reaching the said market price. To reach the said $500 market price, XRP would need to climb approximately a whopping 20,000%. This would take XRP’s market capitalization to unrealistic values.
It is analyses such as these that bring forth clarity to unrealistic expectations. Even if XRP were to be boosted by institutional investors, such a large market capitalization is an unlikely event to occur.
However, with inflation and positive market conditions, XRP could achieve a $500 market price somewhere in the distant future, given that it performs far better than it is doing at the moment.
Certain key factors are necessary for XRP’s price to reach the $500 mark. Chief among them is gaining investor trust. With XRP’s cloudy background slowly lifting, investors may find their confidence in XRP once again. This could fuel the next stage in XRP’s growth.
XRP could be adopted by an international money transfer institution as the underlying asset for cross-border transactions. At the moment, since only the software is being used for the above-mentioned international transactions, the use case of XRP is largely limited. Once this limit is bypassed, XRP could surge ahead and reach the $500 mark eventually.
Conclusion
The fever dream of XRP reaching $500 price is a long shot for the time being. However, positive market conditions and a good track record could prove otherwise.
With incoming institutional recognitions and expanding real-world use cases, XRP does have the potential to scale the heights of $500. For this institutional support to come in XRP’s way, XRP will have to clear the fog surrounding its centrality. Ripple Labs will have to make amends if they are to boost the potential of XRP.
To reach the dreamed destination of $500, XRP still has a long way to go, but what seems impractical but theoretically possible could be made a reality if proceeded with careful planning and wise decisions ahead.