Ripple is a payment protocol that uses blockchain technology to process international money transfers. It offers low transaction fees and extremely fast processing times, and it has partnered with hundreds of financial institutions that use its technology. In this article, we will talk about is XRP a good investment or not.
There’s a common misconception that Ripple is a cryptocurrency. Ripple itself is not a cryptocurrency, but it does have a native cryptocurrency called XRP. Those who like Ripple and want to invest in it can buy XRP.
Although Ripple has potential, it also has had some high-profile issues. Most notably, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against it at the end of 2020. If this crypto project caught your eye, here’s a complete look at its story so far and how it works.
Is XRP a good investment: History of Ripple
Software developer Ryan Fugger came up with the first version of Ripple when he founded RipplePay in 2004. The site allowed people to extend credit to others in their community. This makes Ripple the rare crypto project that was around in some form before Bitcoin, although it wasn’t a cryptocurrency at the time. Bitcoin’s anonymous creator, who used the pseudonym Satoshi Nakamoto, even mentioned Ripple once in an email.
Programmer Jed McCaleb started developing the XRP cryptocurrency and blockchain in 2011. He recruited a team, found investors, and approached Fugger about using his RipplePay network in 2012. Fugger agreed to hand over control of RipplePay.
They launched their company and the XRP cryptocurrency in 2012. The company was originally called NewCoin before changing the name to OpenCoin and then later to Ripple.
Ripple would go on to establish partnerships with financial institutions. In 2019, it announced that more than 300 financial institutions in more than 45 countries were using its RippleNet payment network. If you’re debating whether this cryptocurrency is a good investment, Ripple’s success so far is one point in its favor.
On Dec. 22, 2020, the SEC filed a lawsuit against Ripple for selling $1.3 billion in unregistered securities through its XRP cryptocurrency. Ripple has denied the allegation, claiming that XRP isn’t a security.
23 Reasons Why You Should Invest in Ripple Today
There are all kinds of reasons why you might want to invest in Ripple XRP — probably some you’ve never considered. Is XRP a good investment? Let’s talk about it.
Ripple has fast transaction speeds
For a cryptocurrency to function as a currency, the transaction speeds have to be better than what is on offer in the market. Otherwise, there would be no point in it.
This is the main reason why Bitcoin is now viewed as a store-of-value than a currency. It’s slow, and the transaction costs are getting out of hand. On its part, XRP functions quite efficiently as a currency, a factor that could see its usage grow exponentially in the long run.
Not only can XRP handle thousands of transactions per second, but it also does it almost instantaneously. This will be critical to its long-term growth in value and makes it a worthy investment.
Ripple has a strong network effect
Ripple is one of the world’s most recognized cryptocurrencies. The only other cryptocurrencies that have the same level of recognition as XRP are Ethereum and Bitcoin.
Its strong market presence stems from the fact that it is one of the oldest cryptos, and that it has been the 3rd largest in crypto for years. This only changed recently, after issues with the SEC escalated.
So does its recognition matter? Well, it matters because as the market keeps expanding, newbie investors are likely to focus on most of the top cryptocurrencies. This could see XRP uptake grow, and as demand grows, so will its value.
XRP Nominal Price is Low
Is XRP a good investment? Even if trading short of its all-time high of $68k, Bitcoin is still gaining in value.
Most altcoins are gaining rapidly too. In this fast-expanding market, small investors looking to buy crypto in sizeable volumes are looking to high potential cryptos with a low nominal value.
XRP is one of the best on this front. Unlike most tokens that may not have much underlying value, XRP is quite cheap and affordable, and it has value through adoption. This makes it perfect crypto for one to buy in large volumes, in anticipation of more gains in the future.
XRP is listed on multiple exchanges
Where crypto is listed matters a lot in its value appreciation. That’s because, if it is not easily accessible, then demand is only limited to those who can access it. XRP does not have this problem.
As one of the oldest cryptocurrencies, XRP is listed on pretty much all major exchanges. Once its issues with the SEC are over, even more exchanges, especially American ones will list XRP. This not only makes it liquid but also one primed for exponential gains as the uptake of cryptos as a mainstream investment grows.
Ripple has a strong and aggressive community
Is XRP a good investment? The Ripple XRP community is one of the largest, strongest, and most aggressive in the world. Anytime XRP comes under attack, they fight back on all platforms from Twitter to Reddit.
The latest was during the SEC case where they demanded to be enjoined in the case as interested parties. This is a big deal because it is an indicator that the community believes in XRP. This will have the effect of drawing in more investors to the XRP network in the long run, and drive up its value. It is a good reason to invest in XRP now.
Ripple has a strong team behind it
The team behind a crypto project can either make or break it. Many cryptos have gone into oblivion due to weakness in their core teams. XRP does not have such problems.
It was developed by one of the best brains in cryptography. This means XRP will never have to deal with the risks that most projects go through. Such guarantees make XRP a good investment now that overall interest in the crypto markets is on the rise globally.
XRP will benefit from Ripple’s aggressive expansion
Ripple is the primary company that uses XRP to settle transactions. Though XRP is in no way a Ripple security as has been claimed by some, Ripple is a critical pillar to the long-term growth of XRP.
That is because it uses XRP to settle transactions fast, and at a low cost, and this is important to the long-term growth of XRP. The best part is that Ripple has been quite aggressive in pushing for the adoption of XRP. A number of financial institutions are ready to work with Ripple, and the numbers will only keep growing. This is a bullish signal and makes XRP good crypto to buy now.
XRP will benefit from an improving regulatory environment
The regulatory environment has not been pro-crypto for a long time. Even now that the market has gone mainstream,
Some jurisdictions such as the U.S, Turkey, among others are still largely anti-crypto. However, overall the tide is turning. In Asia, lots of countries are openly pro-crypto.
Even in North America, Canada is quite receptive and has a number of crypto ETFs is on the rise. This increasingly favorable regulatory environment is a bullish signal for the entire market, including XRP.
Ripple XRP has a growing presence in Asia
Asia is one of the largest markets not just for cryptocurrencies, but for financial technologies in general. That’s why any cryptocurrency that finds favor in the market is bound to succeed. XRP is one of the cryptocurrencies that are increasingly adopting XRP through Ripple.
In places like Japan, financial institutions have been settling transactions in XRP for a while now. This is a strong case of adoption, one that could play a huge role in its value growth. It’s quite a compelling reason to invest in XRP today.
Ripple is benefiting from the growing overall crypto adoption
The crypto market has been expanding quite exponentially over the past year. It went from a market cap of $200 billion to its current net worth of $2.2 trillion.
This expansion has served to uplift the entire market, and that includes XRP. Despite its issues with the SEC, XRP’s price has more than doubled from around $0.50 to over $1.50. At the moment, all indications point to further growth in the market. This is a good reason to invest in XRP, with a long-term view.
Ripple is a secure cryptocurrency
Security is an essential part of the survival and growth of any cryptocurrency. Without it, the crypto would be easily compromised, and lose a huge portion of its value.
For context, one needs to look at Verge, a privacy-focused cryptocurrency. Back in 2017, it was performing very well but quickly lost its market appeal after it was compromised twice. XRP is quite immune from this problem.
It is one of the most secure cryptocurrencies and has never been compromised in the more than a decade that it has been in existence. This is a good reason to believe in the security of the XRP network, and its potential for success in the long run.
Ripple is environmentally friendly
As the crypto market expands, the issue of the environment is becoming a reality. Proof-of-Work mining is now a huge contributor to carbon in the atmosphere, and crypto experts are now calling for a change.
One of those that have been calling for reforms is Chris Larsen, the co-founder of Ripple. Chris recently stated that there is a need to adopt Proof-of-Stake and other consensus algorithms such as the one used by XRP.
This means XRP has a team that cares about the environment. In a world that is increasingly sensitized to climate matters, this is a reason to choose XRP over other cryptocurrencies.
Ripple XRP is stable despite Jed McCaleb’s relentless selling
Is XRP a good investment? Jed McCaleb is one of the founders of XRP, and later started a rival project called XLM. This created complications and Jed has since been offloading his stash of about 8 billion XRP.
Lately, he has been selling millions of dollars worth of XRP a week. His selling is a bullish signal in two ways. Firstly, his selling will improve the token distribution of XRP, which will increase investor confidence in XRP. Secondly, it is an indicator that the demand for XRP is strong.
That’s because, despite the heavy selloffs, the price has been on the rise for months. While Ripple’s recent wins against the SEC have played a role in its rise, the fact that it has been resilient to Jed’s selling is a sign of strength.
It is an indicator that the XRP could rally even more once he is done with his stash. Until September 1, he had been selling 8,489,328 and 9,080,265 XRP lumps on a daily basis. Jed sold 198.3 million XRP coins throughout August, overall. Since the last tranche from Ripple Labs, when Jed received 174,862,720, not a single transaction was made from his “tacostand” address. Overall, Jed McCaleb sold 2.6 billion XRP in 2021. If he decides to resume selling, he is likely to run out of XRP by mid-2022.
XRP technical analysis points to strength
The technical indicators of any asset play a role in attracting bulls or bears. In the case of XRP, the technical indicators are bullish.
On the weekly and monthly charts, key indicators such as the RSI, moving averages, and volume oscillators are all bullish.
This will keep drawing in buyers into the cryptocurrency, especially now that the whole market is bullish. The buying pressure that XRP is experiencing now is a good reason to invest, both for short-term gains, and long-term value appreciation.
Ripple Has Lots of positive press at this point
In crypto, the news is everything. Just some small negative or positive news can rally or crash the market. In March, there was a FUD tweet insinuating that the U.S government would crackdown on crypto, and this led to a correction of over 10% in the whole market.
In the context of this environment, Ripple XRP is in a good position right now. It is one of the cryptos that have lots of good news coming in, especially with regard to its case with the SEC.
As long as XRP keeps making small wins, its value will keep rising. In the event that the case is thrown out altogether, it could create a massive rally in XRP, and possibly see it surpass its 2017 highs. With the entry of a more flexible chairman at the SEC, this is a reason to buy XRP in anticipation of a possible price rally in the near term.
Ripple is very practical for the banking system
Every other crypto out there is premised on the idea of replacing the banking system as we know it. XRP takes a different approach, one of trying to make the system more efficient.
From a practical standpoint, it could be difficult to replace the system, and a more hybrid system could emerge. XRP is right in the middle of this by helping banks settle their transactions faster, and quicker.
It’s quite a logical solution, one that could see XRP take a major position in how the trillion-dollar global financial system operates. Since this is not the first time that the banking system, a factor could play into its long-term price dynamics. For an investor looking at the long-term, this is a good reason to get into XRP now and wait.
Ripple’s case with the SEC is going well
Is XRP a good investment? For some time now, Ripple has been embroiled in a tussle with the SEC over whether XRP was an illegal unregistered Ripple security.
The good news is that recent decisions by the judge seem to be in Ripple’s favor. For instance, the judge recently ruled that the personal finances of Ripple bigwigs Brad Garlinghouse and Chris Larsen were immaterial to the case. This led to a spike in the price of XRP.
Ripple has also indicated that it was willing to work with the incoming SEC chairman on bringing the whole case to an amicable close. All these are pointers that the case could well for Ripple, and finally free XRP from the shackles of uncertainty.
In such a situation, its price would rally to new highs, if its recent price action is anything to go by. Since profitability in the market comes from buying the potential and selling when the good news finally comes out, it is quite logical to buy into XRP now.
The potential of a downside if the case delays are counteracted by the increased bullish sentiment in the market at this moment.
XRP Benefits immensely from FOMO
Fear of Missing Out is always a huge factor when it comes to crypto rallies. XRP happens to be one of the cryptocurrencies that benefit from FOMO.
Back in 2017, the perception was that holding XRP was tantamount to owning part of the success of Ripple. This created FOMO and made XRP one of the best performing Cryptocurrencies in percentage terms. It went from a few cents to over $3.
Lately, the power of FOMO in XRP is evident in its price action this year. When investors noted that Ripple was making gains against the SEC, the price jumped and saw XRP outpace almost all major cryptocurrencies in percentage gains. The power of FOMO in XRP stems from the vocal nature of its community.
Whenever good news is coming up for XRP, they hype it up all over the internet, and any new investor looking for quick gains quite naturally caves in and buys. With this background in mind, it makes sense to buy XRP at current prices.
That’s because if by any chance, Ripple wins the case, or they agree on an amicable settlement with the SEC, the hype would be astronomical. It could easily XRP to prices never imagined before.
Ripple XRP is in tune with the idea of CBDCs
Is XRP a good investment? When it comes to Central Bank issued Digital Currencies, the question is not if, but when, and there will be a mass rollout. China is already rolling out the digital Yuan and is already being tested in Macau and Hong Kong. One of the consequences of the launch of CBDCs is that they could threaten the stable coin market.
It makes more sense for one to use a government-issued stable coin than one that may not be backed with enough reserves. Interestingly, the launch of government-issued digital currencies could spell good tidings for Ripple and XRP.
That’s because Ripple is looking into helping governments issue such currencies through private ledgers. While these ledgers may not in any way use XRP, the excitement that they will generate in the market will have a positive impact on the value of XRP.
XRP Coin distribution is improving
For a very long time, one of the criticisms leveled against XRP was that the coins are concentrated in the hands of a few. While this was the case in its early years, things have changed a lot, especially after the 2017 market Rally. Ripple, which holds lots of XRP, has sold a considerable portion of its stash.
The coin distribution of XRP will get even better later in the year once Jed McCaleb is through selling his XRP holdings. A better coin distribution means that no single entity can easily influence the price of XRP.
This is a big deal because it will inspire more confidence in the coin, especially from institutional players. It is an excellent reason to consider investing in XRP at current prices, based on its other fundamentals, such as adoption by the banking industry.
Ripple has a pre-determined and known supply
Is XRP a good investment? One of the factors that can affect the viability of crypto is its supply. One of the reasons why Bitcoin is so valuable is its pre-determined supply. Similarly, while Ethereum has no fixed supply, the process of bringing new Ethereum into the market is a tough one, which keeps the supply quite low.
On its part, Ripple XRP’s advantage is openness in its supply. All the XRP that could ever come into existence is already pre-mined. This means there will never be surprises in supply that could affect the supply. This coupled with the improving coin distribution makes XRP an attractive cryptocurrency to a long-term investor. By extension, this makes it one of the best cryptocurrencies to invest in today.
Ripple FUD has largely been debunked
If there is a cryptocurrency that receives lots of FUD, especially about it being security. Besides the ongoing case between the SEC and Ripple, this is FUD that has largely been debunked.
That’s because even if Ripple were to stop existing today, XRP would still survive and thrive. This means that once the case is cleared, there won’t be anything else left to FUD XRP. The use case in cross-border payments is already established, and XRP can do it with or without Ripple. With FUD losing steam and adoption, there has never been a better time to invest in XRP.
XRP is widely accepted as a currency
Is XRP a good investment? Outside of Bitcoin and Ethereum, XRP is one of the most widely used altcoins for payments. It makes sense because it is practical for payments. Sending value through XRP is almost free, and it’s instant.
As more people adopt cryptocurrencies for payments, more people will get to appreciate this aspect of XRP. This will impact its demand, and by extension, its value as the years go by. It also makes XRP a good investment with real value, over and above the usual crypto-related speculation.
Is XRP a good investment: The Bottom Line
If you’re prepared to invest in ripple XRP and play the long game, then XRP could well be a worthy investment. It is also still cheap, so it’s perfect for beginners who wish to start small. Investing in Ripple certainly looks like a bright future could be on the horizon for a cryptocurrency.
Interestingly, David Schwartz, CTO of Ripple Labs, Inc., said at the 2019 Future of Fintech conference in New York that financial institutions are “extremely conservative” and “slow-moving.” This could go some way toward explaining that, while there has been much interest in XRP, actual adoption has been a slow process — and, as such, the price has remained rather stagnant for some time.
Of course, a lot of this may still rest on what transpires with Ripple’s legal battles. Nevertheless, given XRP’s unpredictable and surprising price history, XRP is certainly one of the digital assets worth adding to your investment portfolio.
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