Predict the price of XRP if it wins a lawsuit
2020 was an amazing year for cryptocurrencies, ending with the most notable rally since late 2017. Coins reached all-time highs, with topping the cryptocurrency rally. Bitcoin price reached an all-time high of over $58,000, and other prominent altcoins like Binance Coin benefited from the market growth. XRP, the original coin, did not imitate its rally in early 2018 when it crossed $3. However, the financially oriented payment network increased its market value during the emerging bullish wave.
In December 2020, Ripple’s potential market growth stalled after the US Securities and Exchange Commission (SEC) sued Ripple and its CEOs Bradley Garlinghouse and Christian A. Larsen for failing to register the original network token as collateral. The multi-billion dollar lawsuit targeted Ripple’s business from 2013 onwards. However, the filing in the Southern District Court of New York is viewed with skepticism in the crypto space.
What is XRP?
Ripple has reworked how the XRP token required for cross-border financial transactions fits into the blockchain ecosystem. Unlike Bitcoin, which has an intrinsic value and is not a security according to the SEC, XRP facilitates the transfer of funds between different countries and financial institutions. Its value lies in the fast processing speed. This is why their partnership with MoneyGram made Ripple put its XRP token to good use as it faced a backlash from the crypto community for being a financial token.
Unlike Bitcoin or Ethereum, where new coins are generated through the mining process as a reward, the amount of XRP is limited to 100 billion coins. XRP tokens are distributed to companies and financial institutions such as Santander (MC :), Commonwealth Bank of Australia (OTC 🙂 or MoneyGram to create fast transactions over the Ripple network and avoid high transfer fees. Thus Ripple is an inter-enterprise payment network that helps reduce transfer and payment fees by relying on the xRapid network.
What happens with XRP during the lawsuit?
The lawsuit related to Ripple’s activities from 2013 to the present is a bit strange as it was filed in the last moments of the previous administration and is seen as a means of trampling on the potential growth of XRP. Although XRP suffered a loss of nearly 60% in price after the lawsuit began, it recovered despite coming under scrutiny in the US market and exchanges became wary of accepting XRP trades.
Recently, MoneyGram announced that it would discontinue its partnership with Ripple, and the use of the XRP token, after the Securities and Exchange Commission launched its lawsuit. They have joined other well-known companies such as Binance US, Swipe, and OKCoin that have stopped trading or using XRP, leaving American investors in limbo. Although the market has turned south on the XRP token, the analysis indicates that the price has stabilized, with an upward trend and a sign of a possible breakout for the coin. At the time of writing, XRP has a market capitalization of over $20 billion and a single unit price of $0.44, down 5% from the previous week.
on the flip side
- The current price of XRP reflects ongoing legal action and news about the progress of the trial.
- The price will remain the same with minor changes while investors wait for a significant increase or decrease depending on the legal decision.
- If Ripple wins the case, the suspicion of listing the exchange will be ignored, and more XRP liquidity transfers will begin in the US market.
- The positive or negative conclusion of the SEC lawsuit will fundamentally and irreversibly change the blockchain space in the United States.
XRP remains in high demand as exchanges outside the US aim to list the token, although there are doubts about where XRP will end up. According to Jesse Powell, CEO of Kraken Exchange, which recently delisted XRP for US residents, XRP could be the responsibility of exchanges depending on the outcome of the experiment. He stated, “If XRP was found to be a security, the SEC would say that the exchanges should have known.” If that happens, exchanges operating within the United States will face changes as a side effect of the ongoing struggle with the Securities and Exchange Commission. Although US citizens have limited opportunities to transact XRP on local exchanges, the token is not without support outside the US. Ripple Labs, Inc. is still It creates new business opportunities by expanding its operations with Japanese banks and leading the new ledger project for central banks. If US regulators fail to establish more rigorous US blockchain regulations, Ripple is considering a move, as its usability and centralized nature are beneficial to the financial system.
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