How Is XRP Doing Since Ripple Co-founder Jed McCaleb Sold 54 Million?
Ripple (XRP) has been one of the most interesting cryptos on the market for a long time and at the same time is considered one of the most speculative. Unlike many other big crypto players like ETH XRP is not decentralized, which leads to the ongoing debate about its market perspectives among many traders and analysts. In 2020 Ripple went through SEC’s lawsuit and since that period any forecasts regarding its price remain somewhat subjective. Today. we’re going to shed light on the Ripple perspectives and provide some expert analysis of its performance in recent years.
What is Ripple?
To make it a good start we have to get you equipped with basic terms related to the project. Ripple is an organization, providing the payment protocol equivalent to currency exchange or payment system. XRP is the coin used for the operations according to this protocol. The nature of XRP makes it especially interesting to banks, investment funds, and other financial organizations. The major advantage of XRP is its ability to process fast transactions at relatively low fees across the world. Ripple can be considered an alternative to money transfer systems. Since the start of the network operation in 2012, the largest world financial actors have used it for its operations.
Ripple’s Crash in 2020
For many years Ripple demonstrated successful performance and regardless of its speculative nature increased its capitalization and expanded the network. But, in 2020 several events significantly influenced the crypto’s price, changing its dynamics for the worse. The first drop in XRP price took place in April 2020, when its owner McCaleb unexpectedly sold 54Mln XRP. McCaleb explained that he had no intention to negatively influence XRP development and his decision was quite personal, but it had not prevented the coin from dropping in price. But, this event hasn’t made a significant impact in comparison to the SEC case against Ripple at the end of 2020 (no decision yet). The reason for the lawsuit has been the sales of $1.3 billion securities through the XRP network. SEC being the major regulator of the securities market in the USA could not miss this operation regardless of the fact that Ripple is not considered a security. The start of the case led to the 50% drop off in XRP price and since that period it has never returned to its record numbers.
What is the future of XRP?
The SEC case is not yet solved, hence Ripple’s future remains in dark. Many exchanges have stopped the XRP trade until the SEC decision will be issued and there is still some delisting rik. Although this event is not quite viable, it still has a negative impact on XRP price projections. As a result, the recommendation of the majority of experts is to get rid of the big positions in XRP in favor of other big market players. A good idea is to exchange XRP to ETH and leave a small fraction of it to potentially earn on its price hike in case of a dropped SEC lawsuit.
In the long term perspective Ripple still has a future if SEC gets out of the case, but it does not mean that a similar situation will not happen again. Remember that Ripple is still not quite an ordinary crypto and it has been a major speculative asset for many years. These days the market is very volatile and XRP still follows the trends, but the minded investors do not consider the main market player as some years ago. If you’re not a trader, but an investor a better idea is to focus your attention on more stable and less speculative projects.