A few weeks ago, Ripple’s XRP shook an already shaken crypto verse by taking the second spot by market capitalization over form Ethereum. It didn’t last too long. XRP went back to its usual (and quite worthy) third place again before too long. This could be just a random anecdote or taste of what’s in the future.
The XRP cryptocurrency has considerable leverage over the crypto verse because of several reasons, one of which is the platform that supports it. That’s Ripple. Unlike most of the other digital coins in the cryptosphere, XRP and Ripple have been moving for years towards a particular long-term goal which is adoption by the world’s banking and remittance system so that friction in international transfers is lessened or eliminated entirely.
In that sense, Ripple and its coin have a character that you don’t find in other blockchain projects. Think about projects like Litecoin or Bitcoin Cash. They are merely Bitcoin in a different, lighter flavor.
So while they have something to offer (more energy efficiency, basically), they’re mostly the same as Bitcoin, so their innovative credentials are null. Ripple, on the other hand, is different in its purpose, technology, and almost every other imaginable way.
The Ripple project was founded in 2012, and even back then it already had a focus on the transfer of value between banks and beyond borders. And in this case “value” doesn’t mean fiat money only but all kinds of other financial instruments. Ripple even had a smart contract platform ready for deployment before Ethereum (which is essential because that’s the technology that became Ethereum’s claim to fame), but it dropped the project to concentrate in its flagship project.
Banks were not overly enthusiastic about Ripple’s currency, network or technology. The crypto verse wasn’t any friendlier as crypto purists resented a blockchain project helping the very system that Bitcoin is supposed to bring down. But after almost seven years of hard work and many successes under the firm’s belt, have persuaded many of the world’s more influential banks and, over the last few months, new banks have been lining up to work with Ripple.
Economists have famously said that any economic crisis is an excellent opportunity for creativity to surge. It must be noted that they’re painfully correct and the long crypto winter has indeed boosted innovation in the crypto environment, and Ripple has been among the primary beneficiaries.
Ripple’s technologies for the facilitation of payments (xRapid, xCurrent) are gaining adoption at least as testing programs in hundreds of banks in the world, and this affects XRP noticeably. The coin has a user base that, unlike the rest of the cryptosphere, is not comprised of retail investors or individuals but of banks and large institutional users which is a substantial and stable base. This is a massive advantage over every other cryptocurrency (with the possible exception of Stellar Lumens’ XLM, more on that later) in the world.
Ripple was alone in its ambition until recently. Stellar Lumens has been trying to disrupt the very same market as Ripple. Both projects are very alike for several reasons. Stellar started as a fork in Ripple’s technology and blockchain, and it was founded by Jed McCaleb who left Ripple (which he also founded) to start Stellar. So Stellar knows Ripple almost as well as it knows itself and it’s now in direct competition against it.
Stellar Lumens’ technology is inferior to Ripple’s to be sure. But IBM has adopted Stellar as its blockchain of choice, so every future interest IBM could have for blockchain projects will be developed and deployed using Stellar. This is huge. Do you remember what IBM’s support did for Intel or Microsoft? Well, by that token (pun intended) IBM’s influence alone could turn Stellar Lumens into the crypto verse’s Intel or Microsoft.
Both technologies could complement each other as Stellar has the consumer aspects of its technology very well developed while Ripple has achieved some outstanding results in the enterprise side of things.
Both are cheaper and faster for customers and banks than the available traditional options. So between both technologies, they could take over the market in the future. And that will increase dramatically the trade volume for both coins as well as the demand. That’s how a token’s price goes up steadily.
In brief: Ripple’s fundamentals are the most solid in the crypto world (with Bitcoin being the only possible exception). And that’s why it overtook Ethereum at the second spot a few weeks ago.
Also, it’s been the most profitable cryptocurrency for two years in a row, and it could reclaim the title for this year. So, all other things being equal, Ripple keeps reporting great news, announcing new partnerships. It will be a good year for Ripple as a company and for XRP as a cryptocurrency.
Image courtesy of Pixabay.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.