Ripple is a leading blockchain project whose goal is to help companies move money internationally at a faster pace. XRP is the native cryptocurrency for the ecosystem. According to CoinGecko, the coin has a total market capitalization of over $36 billion, making it the 6th biggest cryptocurrency in the world. In this article, we will look at the recent price action of XRP and what to expect in 2022. You can also learn more about the best way to buy XRP at Bankless Times.
XRP price performance
The XRP token has had mixed fortunes in the past few years. In total, the coin’s price has soared by over 1,000% in the past five years. As a result, it has outperformed other popular assets like the S&P 500 and gold. It rose to an all-time high of $3.35 in December 2017 and then dropped to a low of $0.1145 in March 2020 at the onset of the Covid-19 pandemic. Today, XRP is about 75% below its all-time high.
Important XRP movers
There have been several key reasons that explain the performance of the XRP token. First, in the past few years, Ripple Labs has partnered with some of the leading companies in the world. Its biggest partnership was with MoneyGram, the giant money transfer company. The deal was terminated in 2021. Some of the current partners are companies like Azimo, Santander, American Express, Ria Money Transfer, and SABB, among others.
Second, XRP has done relatively well because of the overall performance of other cryptocurrencies. In the past few years, Bitcoin and other altcoins have been in a bullish trend. This performance has helped push their total market capitalization to more than $2 trillion. A closer look at these digital currencies shows that they typically move in sync.
Third, the name recognition of XRP has helped it do well in the past few years since it was among the first cryptocurrencies ever launched. Furthermore, many people buy XRP because of the market size that the developers are addressing. The remittances industry processes trillions of dollars every year. Therefore, they assume that XRP will do well even if Ripple captures just a small part of the market.
Fourth, monetary policy has been a bit supportive in the past few years. The Federal Reserve has generally left interest rates at record lows in a bid to support the American economy. Historically, newer and riskier assets tend to do well in a period of low-interest rates.
SEC vs Ripple case
A key factor that has affected the XRP price in the past few years is the ongoing SEC vs Ripple case in the United States. The SEC filed the case in December 2020 and accused Ripple Labs and its senior executives of raising billions of dollars without following the law. Ripple has rejected these claims and vowed to defend it in court. The company says that XRP is just a normal cryptocurrency like ETH and BTC.
The XRP price crashed hard after the SEC filed its lawsuit but later on staged a strong recovery as investors followed the proceedings. Close watchers expect the judge overseeing the case to deliver his judgment later in 2022.
Therefore, because of the ongoing case, analysts believe that investing in XRP carries some risks. The main risk is that the judge could rule in favor of the SEC. If this happens, we could see some volatility of the XRP price. On the other hand, if Ripple loses, there is a possibility that the price will continue retreating.
How to buy XRP
There are multiple ways of buying Ripple. First, you can decide to use a centralized exchange that accepts XRP. Shortly after the SEC filed its suit, several exchanges decided to cut XRP off from the services that they offer. But some of the leading exchanges currently accept the coin. Examples are Binance, CEX, and Kraken.
Second, you can decide to use a decentralized exchange to buy the coin. A DEX is an open-source exchange that is not controlled by an individual. They also don’t require one to register to use their services. Instead, you just need to link your wallet.
Third, you can use peer-to-peer marketplaces to buy XRP. These marketplaces act as a middleman to facilitate trade between two individuals. Additionally, you can buy XRP from a forex and CFD broker. These companies offer XRP in the form of a CFD that tracks the price of the real coin.
Summary
XRP is one of the oldest cryptocurrencies in the world. Over the years, it has been one of the best-performing currencies in the world. However, it has also had its challenges. In this article, we have explained some of these challenges and how they could affect the coin going forward. Most importantly, we have assessed how to buy the coin and the risks associated with it.
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