XRP may achieve new record highs in the coming years.
Investing your life savings in cryptocurrencies can be risky due to their volatility compared to stocks and other traditional assets. Nevertheless, some promising cryptocurrencies may be worth exploring with a small amount of money you can afford to lose.
For instance, investing $100 in XRP (XRP 0.74%), the native cryptocurrency of the XRP Ledger, at its initial trading price of $0.005 in 2013 would now be valued at $53,000. Let’s explore the reasons behind its price increase and why it remains a solid investment choice for $100.
What Caused XRP’s Price Surge?
Ripple Labs, a technology company specializing in blockchain-based money transfers, introduced the XRP Ledger in 2012 as the foundation of its services. XRP was marketed as a faster, cheaper, and more secure option compared to traditional SWIFT (Society for Worldwide Interbank Financial Telecommunication) transfers.
The founders of Ripple created the XRP token and generated its total supply of 100 billion coins before its market entry. Currently, 99.98 billion coins are available, but the total supply is gradually diminishing because a small amount of XRP is burned with each transaction, permanently reducing the available supply. To finance Ripple’s growth, the founders sold a significant quantity of XRP tokens, which led the Securities and Exchange Commission (SEC) to file a lawsuit against Ripple in 2020, claiming that it had sold unlicensed securities. As a result, Ripple lost several major clients, and XRP was delisted from prominent crypto trading platforms.
Today’s Change
(-0.74%) $-0.02
Current Price
$2.50
Key Data Points
Market Cap
$150B
Day’s Range
$2.49 – $2.54
52wk Range
$0.49 – $3.65
Volume
3.2B
Avg Vol
0
Gross Margin
0.00%
Dividend Yield
N/A
Consequently, XRP’s price plummeted from its peak of $3.84 in January 2018 to a low of $0.31 in 2022. The increase in interest rates during 2022 and 2023 also contributed to a broader market downturn in cryptocurrencies.
However, in 2023, a district judge determined that XRP tokens traded on public exchanges were not considered securities, though those sold to institutional investors were. Ripple was fined $125 million, a sum significantly lower than the SEC’s original proposal of $2 billion, and an injunction restricted it from selling more coins directly to institutional investors.
The lawsuit concluded in August, leading to XRP being relisted on major exchanges. Several asset management firms filed for spot price XRP exchange-traded funds (ETFs), and one particular ETF—the REX-Osprey XRP ETF—was approved to begin trading swiftly on the CBOE.
The Trump administration even identified XRP as one of five digital assets—alongside Bitcoin, Ethereum, Solana, and Cardano
Unlike many other cryptocurrencies that reached new highs in the past year, XRP is still nearly 40% below its peak. Although its major obstacles have diminished, its long-term drivers remain uncertain. It can’t be valued based on scarcity like Bitcoin, which continues to be mined, nor can it be assessed through the growth of a developer ecosystem like Ethereum. XRP’s valuation largely hinges on its role as a bridge currency between less stable or liquid assets. For instance, transferring between two thinly traded currencies typically involves converting to a more widely accepted currency (like the U.S. dollar), a process that can be slow and costly. However, using XRP as an intermediary allows for faster and cheaper transfers. In June, Ripple’s CEO Brad Garlinghouse stated that XRP could secure up to 14% of the SWIFT transfer volume by 2030. This increased adoption could position XRP as a reliable cryptocurrency, akin to Bitcoin, even if it’s not directly comparable to gold or other physical assets. Unlike Ethereum, XRP does not inherently support smart contracts that are utilized for decentralized applications (dApps); it only runs simpler programs. However, developers might introduce Ethereum-compatible smart contracts through sidechains in the future, enhancing XRP’s appeal and driving further integration into decentralized finance (DeFi) applications. The SEC may approve new applications for XRP ETFs soon, potentially attracting more retail and institutional investors. Additionally, Ripple’s recent application for a U.S. bank charter could further increase XRP’s attractiveness. With a market cap of $145 billion, it’s unlikely that XRP will repeat its astonishing 52,900% growth over the next decade. However, with regulatory hurdles behind it and various growth opportunities ahead, XRP has the potential to reach new all-time highs in the coming years. While it remains a speculative asset, a modest investment of $100 may be worthwhile.What Could Fuel Further Price Growth?
Is XRP Poised for New Highs Within the Next Decade?
