xrp crypto stock

With All These Delistings, There’s Just No Good Reason to Buy Ripple

With All These Delistings, There's Just No Good Reason to Buy Ripple
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In recent months, the cryptocurrency market has been in a strong bull market with an occasional, but normal bump in the road. Investors wanting exposure to this emerging asset class using altcoins can still ripple (CCC:XRP), you may want to appreciate the critical difference between low prices and low hanging fruit that is worth nibbling on. Let me explain.

Source: shutterstock

Early last week, newly appointed Treasury Secretary Janet Yellen had a few unfriendly words to say about cryptocurrencies while targeting the early champions in the asset class. Bitcoin (CCC:BTC) And Ethereum (CCC:ETH).

And while she was still just a candidate at the time, she had investors do more than just listen. For its part, BTC shed about 10% during the week. The bearish reaction also helped bitcoin pare its 46% gain in January.

So, what’s all this brawl about? And what does that have to do with XRP? In short, senior government officials have expressed interest in “shrinking the cryptocurrency market” due to popular acceptance by bad actors doing bad things. Unsurprisingly, the observations forced altcoin investors to consider the growing potential for digital currency regulation.

On the plus side, Yellen recovered her fears a notch or two later in the week. Warning also goes against big companies Square (New York Stock Exchange:mint), c. B. Morgan Chase (New York Stock Exchange:JPM), PayPal (NASDAQ:PYPL) and others like outspoken and famous fund manager Cathy Wood who are still busy building various crypto alliances and/or advocating for Bitcoin, Ethereum, or both.

But make no mistake, the altcoin XRP is not BTC or ETH. This is good news for this third or fourth banana clearly now in the cryptocurrency market. Today, dormant threats that may or may not come to fruition are taking a very real back seat to placing Ripple as a potential “unregistered security” under investigation by the Securities and Exchange Commission.

Ripple has its problems

as Investor Josh Enomoto explained earlier this month that unlike other major crypto plays created by open-source digital mining efforts, XRP developer Ripple Labs controls the supply of altcoins. Because the currency is not fully decentralized, it has opened the door to an investigation by US regulators.

For now, the SEC ruling is ongoing. The final decision may end with the cancellation of XRP. Alternatively, the outcome could also lead to a more modest penalty for the Ripple developer.

Your guess is probably better than mine.

However, in the court of public opinion, cryptocurrency trading is a heavyweight Queen Piece With the removal of XRP and other trading platforms expected to follow suit, the chance of the low-priced fruit turning into anything other than regret over the low prices is increasing.

ripple weekly price chart

Ripple (XRP) Alarmingly Falls to September Lows

Source: Chart Courtesy of TradingView

Low-priced stocks in the stock market are often disappointing investments. On the surface, XRP does a good job of embodying those concerns at a market price of just 26 cents.

More importantly, and a stern warning for crypto investors looking for an inexpensive altcoin, is Ripple’s price action.

Technically and on the platforms where Ripple is still available for trading, XRP detached from the asset class two months ago. And two things happened. First, unlike other major currencies, XRP failed to reach all-time highs. Second (and perhaps more dangerous), the cryptocurrency has given up its entire rally from its September lows.

As mentioned earlier, in BTC only the most recent investors in the coin are bearing the losses. Anyone who buys bitcoin before January is up. In fact, BTC has (almost) regained the popular 38% from its September low to its January high. On top of that, bitcoin has (conservatively) stayed more than 200% above those prices.

Bottom line and for inherently ambivalent investors, the “risk capital only” warning is increasingly challenged by what’s happening and on the XRP price chart.

So, while it might be easy to justify buying Ripple for 26 cents with the excuse of “what’s the worst that could happen?” This is one of the situations that comes to mind Warren Buffett’s famous words “price is what you pay, but value is what you get” and deserves your respect.

Shares Owned: At the date of publication, Chris Tyler holds, directly or indirectly, positions in listed Bitcoin and Ethereum stocks (GBTC, ETHE, ETCG), but no other securities are mentioned in this article.

Chris Tyler is a former land-based derivatives market maker on the American and Pacific Stock Exchanges. The information provided is based on his professional experience but is only intended for educational purposes. Any use of this information is 100% individual responsibility. For additional market insights and related musings, follow Chris on Twitter Options_CAT and StockTwits.

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