The Potential of XRP
If you’re familiar with cryptocurrencies, you likely know something about Bitcoin and Ethereum. Bitcoin, of course, is the one that started it all. Since its launch in 2009, Bitcoin has been the king of the crypto industry. Following in its footsteps is Ethereum, which has been around since 2015. These two crypto giants have set the tone for the industry, which includes thousands of cryptos running on decentralized blockchains. Yet even with Bitcoin and Ethereum controlling the crypto market, is there a different crypto lurking in the background ready to take over?
XRP is a cryptocurrency created by Ripple, a digital payment network. Ripple created XRP, a cryptocurrency that runs on decentralized blockchain technology. The purpose was to create a payment system for banks that would make transactions faster and cheaper than ever before. Sending payments across the globe is costly and time-consuming, so Ripple created XRP to solve this problem. With XRP, the times of paying hefty fees and waiting multiple days for money to transfer are gone. XRP transactions cost a fraction of a penny and are finished in seconds. This technology is what both Ripple and many XRP enthusiasts believe can one day change the world of finance.
Both financial institutions and individual consumers can use XRP. For both parties, the primary use for XRP is to send money throughout the world. As mentioned previously, the current banking system is costly and inefficient. XRP makes it easy for the individual to send money from person to person, no matter where you and your recipient are in the world. For financial institutions, the largest user of XRP today, the premise is the same. These institutions can use XRP to transfer money worldwide in a much faster and cheaper way. Today, institutions such as Bank of America, American Express, Santander, Novatti, and many more are in contract with Ripple. Hundreds of companies and customers use Ripple’s network, which uses XRP to complete its transactions. Essentially, XRP is a better, cheaper, and faster SWIFT — the main system used today to transfer money throughout the world. This is why the potential of XRP is so immense. Ripple built XRP to be a crypto that can power the world’s largest banking institutions, and in due time, that may become a reality.
As of April 28, 2022, XRP has the seventh-highest market cap for cryptocurrencies. Its 52-week price range has consisted of a high price of $1.96 and a low of $0.51. If XRP is outstanding, why is the price so low and the fluctuation so large? To answer this, we need to look at the ongoing court case, Ripple vs. SEC.
On December 22, 2020, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs. The SEC built its case on the premise that they believed Ripple had been selling XRP as an unregistered security since 2013, shortly after the token’s launch in 2012. The SEC, which had previously acknowledged Bitcoin and Ethereum as non-securities, flipped the memo on the crypto industry when they claimed XRP to be one. The SEC accused Ripple of benefiting from sales of XRP. The argument from Ripple is that XRP is not an asset of theirs that they can sell but a decentralized currency that runs on the Ripple network.
It is important to note that XRP is still being used on Ripple’s network throughout much of the world, even with the ongoing court case. However, without support from the U.S., XRP has had a troublesome time gaining wide acceptance amongst crypto holders, immensely hurting its overall potential. Since the start of the lawsuit, XRP has been delisted on nearly all crypto exchanges in the United States, killing most of the coin’s value. Since the beginning of the lawsuit in 2020, the courts have delayed the SEC vs. Ripple case multiple times, throwing XRP into a painstaking waiting game. Despite the long and cumbersome process of the lawsuit, the XRP community is expecting a victory when all is said and done.
If XRP can break away from the SEC, it won’t only be a victory for XRP but also for the entire crypto industry. Only time will tell what the verdict on XRP will be, but if Ripple can take down the SEC, there could be immense potential for XRP, which has been lurking in the shadows for years.
