13 min readThe Ripple network is a prominent player in the Crypto market, providing a blockchain-based payment protocol for fast and secure international transactions. Utilising its own Cryptocurrency, Ripple (XRP), the network offers near-instant cross-border transactions.
Ripple labs decentralised consensus algorithm ensures high security, making it a popular choice among businesses and individuals looking for a reliable payment solution.
Ripple investing: what is it?
Investing in Ripple is not too unlike other investing. It does take a different turn as it is a Cryptocurrency investment opportunity, and the fact that the coin of choice here is Ripple makes it slightly different from say trading Bitcoin.
Cryptocurrency investing and trading is different from traditional investing in a good way, as this space has been built to be very inclusive and have little to no barriers to entry.
When it comes to Ripple investment, it is important to know what makes this Cryptocurrency so different from others. While digital assets like Bitcoin, Ethereum and other coins strive for decentralisation, XRP is wholly owned by Ripple.
Ripple is also trying to make a Cryptocurrency to fill a unique niche in the financial world, as they feel that Cryptocurrency can be best used serving banks.
With all this in mind, the question is how good of an investment is Ripple? To answer that question, one needs to have a look at how the coin did in the past years.
Is XRP a good investment? Ripple’s price history
It may sound counter intuitive, but Ripple’s trajectory through 2021 and beyond is probably looking quite good based on the fact that it had a really tough 2020 and the years before. The coin suffered through 2019 and was one of the worse performing top Crypto assets. But this means there is a lot of room for it to go up.
To understand the path to how XRP will perform in the future, and how 2020 shaped it, it is pertinent to go back a few more years and examine the waves of XRP through its history.
Ripple (XRP) origins
XRP was created by Ripple as far back as 2012 with a pre-mined max supply of 100 billion tokens. This figure is a lot larger than the set supply of Bitcoin, which is 21 million coins. Additionally, more XRP coins can be created whereas no more Bitcoin will ever be made.
XRP was trading at a minimum value close to $0.005 when it launched – and prices remained largely flat until 2017, when the entire Crypto industry went through an unprecedented boom. In April and May, XRP ballooned to $0.40 per token, with prices settling down around the $0.20 range for the next six months.
Following Bitcoin’s boom, altcoin season set in and Ripple prices rose 84 per cent in a day from $0.27 to $0.51 mid way through December 2017. The next two weeks XRP rallied to cross the $1 mark and finished the year with an incredible maximum value of $2.30, a total increase of 38,000 per cent.
However, what goes up must come down, and XRP fell below the $1 mark when February 2018 came around. XRP continued to struggle all throughout 2019 and even while other top Crypto assets picked up the pace in 2020, average price of XRP still lagged behind.
In 2021, Ripple (XRP) experienced a significant amount of price fluctuations, with the expected max. price reaching as high as $1.96 in April. However, the average trading price prediction for XRP in 2021 was around $0.60.
Uncertainty in XRP price predictions
Despite these challenges, the token’s price experienced some periods of growth in 2021, particularly in April when the expected maximum XRP price was reached. However, the price fluctuated greatly throughout the year, with periods of decline following periods of growth.
Overall, the price of Ripple in 2021 reflected a complex combination of factors, including market demand, regulatory changes, and investor sentiment.
In January 2022, XRP prices experienced multiple declines before seeing a significant spike, reaching a maximum price of $0.9163. However, the value of XRP quickly decreased due to market domination and investor concerns regarding the ongoing SEC vs Ripple case, resulting in a minimum price drop.
As a result of the partial victory of Ripple in the trial in July 2023, XRP was acknowledged as a Cryptocurrency that was never provided to clients on public exchanges as a non registered security.
XRP reacted positively in a rapid upswing, gaining a double value from $0.4706 to $0.8162, however faced a price correction and subsequently started climbing up again as the year came to an end. Ripple (XRP) price prediction speculations also reacted positively, yet more conservative than expected.
Investing in Ripple in 2024? Is it a good idea?
Having an understanding of Ripple’s background in the last few years is vital to understand if XRP tokens are still a viable investment in 2024 and if you should pursue it.
Ripple’s successful trail period with the Securities and Exchange Commission in 2023 inhaled new life into the token resulting in its rapid spike in price.
Market sentiment reversed towards XRP and many gained new confidence investing with this digital asset, despite the upwards spike was not as global as expected.
But does investing in XRP suit everyone that has access to it? To answer this question, it is important to understand if you are the right person to hold XRP and to trade it — to see if the coin suits your needs and wants.
XRP suits a number of different style traders and investors. It is a good coin for general Cryptocurrency enthusiasts as it is an altcoin.
At the same time, XRP is also a great investment for thematic investors in the financial sector seeing as XRP is a coin aimed at mainstream financial institutions.
And finally, and most relevant, is that XRP is a highly volatile asset and is very good for day traders as it can present many short-term trading opportunities for those who build their strategies based on technical analysis.
SEC vs. Ripple: why is the SEC vs. Ripple case so important?
The United States Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs Inc. back in December 2020, alleging that the company had conducted an unregistered securities offering by selling XRP to investors.
The SEC claimed that XRP was a security and should have been registered with the agency. Ripple, on the other hand, argued that XRP was a Cryptocurrency and therefore not subject to SEC regulations as it did not meet the definition of a security.
Ripple also claimed that the SEC’s allegations were unfounded and that XRP was not an investment contract or a security. The case has been ongoing, and there have been several developments since it was first filed.
In August 2021, Ripple won a discovery ruling against the SEC, allowing it to access internal SEC documents and communications regarding Cryptocurrencies. The case is set to continue, and the final outcome remains to be seen.
The 2022-2023 Crypto winter intensified the pressure on XRP and Ripple continued loosing value as the uncertainty of the trial finale increased.However by mid 2023 Ripple managed to successfully defeat part of SEC’s charges and prove that the token is a Crypto with no relation to non registered securities and was never offered as such.
This allowed XRP to rebuild the foundation of user’s confidence in this asset and allowed it to make the last train to the onset Crypto bull run.Nonetheless, the final outcome of the SEC vs. Ripple lawsuit is yet to take place as other charges still remain unsolved in the court.
Once the trial will face its end, it has immense potential to alter the regulatory landscape for the entire Cryptocurrency industry. The SEC’s intention to establish itself as the primary regulator for the sector is evident, with its action against Ripple marking the initial phase towards categorising all tokens as securities.
Ways to invest in XRP
As mentioned earlier, XRP, as a Cryptocurrency, has very low barriers to entry to start investing and trading in.
Someone new to the space can quite easily buy XRP and begin their investing journey with the coin by just holding onto it and waiting for appreciation — or depreciation.
However, there are a number of different ways that a person can actually invest in Ripple and start to make money off of XRP.
HODLing as a well-established method
It all begins with buying and holding. This is one of the more common and popular methods employed with investing in Cryptocurrency and has especially paid off with regards to Bitcoin. Buying and holding is a simple and usually effective method to profit from a Cryptocurrency, but it may not be the best use of XRP.
Another popular method to invest in Cryptocurrency is usually through mining but it must be mentioned that you cannot mine the XRP token and this again goes back to the supply being owned and controlled by a single company.
Trading as an optimal investment solution
The best way to invest and profit from Ripple is probably trading. In general, trading has become big in the Cryptocurrency space as more and more sectors flood in to be part of the volatile and often profit-filled market.
Trading in Cryptocurrency, including XRP, has taken off with traditional traders as they flood to well-established platforms that offer similar professional services that they are used to. There are also a number of trading products, like XRP futures contracts that allow for shorting and leveraging that make this one of the best ways to invest in XRP.
Pros and cons of Ripple
Just like any asset that is worth trading, and even more so, just like any Cryptocurrency, there comes a list of pros and cons with XRP and trading Ripple. Here are just a few of them.
The Pros
- Low cost: While all Cryptocurrencies can be bought at fractions of a whole — like Bitcoin can be bought with as little as $10, XRP Crypto has a small denomination. As explained above, Ripple has only once been above $1 and so, if you were to purchase the coin, you can get a lot for a little bit of money.
- Solving a problem: Ripple technology has created the XRP token with the express goal of solving a real-world problem with blockchain and Cryptocurrency. Ripple payment network solves problems for large financial institutions and also speeds up the flow of capital, which is excellent for the global economy.But Ripple could work for small business owners, too. If it becomes widely adopted, the Ripple platform will provide millions of sole traders and entrepreneurs with access to the global economy.
The Cons
- Ripple has control: While having Ripple in control of the Cryptocurrency is good for investors from a confidence standpoint, it does bring in the age-old issue of centralised failings. The world has seen a banking collapse in 2008 which brought about Bitcoin, and if Ripple Labs makes some bad calls XRP can fail.
- Centralised: Ripple Chairman Chris Larsen owns around a third of all XRP. Ripple CEO Brad Garlinghouse also holds a significant amount, as do other senior board members. For many purists, this makes the coin feel not like a decentralized currency which is against one of the core tenants of Cryptocurrency.
XRP price prediction and future outlook
As mentioned above there are numerous factors that may define the overall value of this digital asset, making Ripple price prediction a walk through a dark valley. As the partial resolution of the SEC vs Ripple (XRP) promises a bright outlook, some hesitate to make a positive Ripple prediction.
Despite a ‘partial’ victory and uncertainty, Ripple’s XRP has recovered from its minimum value of June 2022. Obtained confidence among traders that XRP is a Crypto asset that will no longer be doubted by the SEC, drew a significant amount of XRP holders back to the Cryptocurrency market.
Both rising market cap and daily trading volumes seem to reflect market sentiment now strongly driven to buy XRP with the hopes of an optimistic XRP coin price prediction by the experts. However, as the bear market reverses, more and more preference is given to top-list performers, such as Bitcoin and Ethereum.
However, overweight towards the leaders along with ongoing lawsuits could potentially undermine XRP’s future and seriously affect its current price. Because of this many still question if Ripple is a stable investment. Nonetheless, XRP’s price recovery reflects strong confidence of full recuperation.
How much to invest in Ripple?
Like most digital assets, the barrier to entry is very low and it is intended to be an entry point for any one who wants to get into the space of trading.
When it comes to Ripple and XRP, as discussed above, there is even more opportunity to get into trading this coin cheaply. The fact that each coin costs less than a dollar means that new investors can spend as little as $10 — on some platforms — and have in their possession a number of XRP coins.
If a trader wants to just test the waters out of Cryptocurrency trading, XRP is probably one of the better ways to go about it because of its low denomination and popularity across many different platforms.
Is Ripple (XRP) a good investment?
Ripple certainly has a lot of pros that many other Cryptocurrencies do not have, such as the Ripple technology. The fact that it is intended to be used by major financial players, and is getting adopted as such, means that there is a lot of room for growth and XRP remains a good investment.
Is it worth it to invest in Ripple?
It is also very much worth to buy XRP because not only is it a smart choice in the Cryptocurrency space for its differences, it is also a coin that is on the lower side at the moment. This means that there is room for it to reach higher, considering its low denomination and current value.
Is it smart to invest in Ripple?
Investing is always about diversifying and making sure you can hedge your risks. Investing in Cryptocurrency is often difficult because many markets often mimic Bitcoin. But, because Ripple is a stand alone company, doing something new in the financial space, it often moves independently.
Should I invest in Ripple now?
Because the XRP Cryptocurrency has had a bit of a time at a lower price range many feel it is long overdue to break up and start taking off again. A lot depends on the advancement of banking and their use of Cryptocurrency. However banks are starting to take this space more seriously and Ripple could potentially rally again.
How should I trade Ripple today?
Trading on the Cryptocurrency market is no different, even if you're facing a bull run in the price of an asset. Technical and fundamental analysis applied to an XRP price chart, a thought out strategy, evaluated risk appetite - all together this could bring better results if XRP is your choice.
Author
Risk Disclaimer
