Contemplating Purchasing XRP as Its Price Holds Below $4?
If you've been eyeing the jaw-dropping rise of Bitcoin after the U.S. presidential election, you might've overlooked an even more remarkable boom in the crypto world. Enter XRP, the digital currency previously known as Ripple, which has witnessed a spectacular surge from $0.52 on November 5 to an astounding $2.73 on December 2. That's the highest XRP has traded at in nearly seven years!
Now, XRP has managed to push past Solana and Tether, claiming the third spot among the most valuable cryptocurrencies globally. But is now the perfect time to jump onto the XRP bandwagon, or has the ship already sailed?
Lifting the Regulatory Shadows
You've got to thank the election of Donald Trump as the U.S. president for this crypto miracle. The Trump administration's pro-cryptocurrency stance stands to make a significant positive impact on Ripple Labs, the entity behind XRP.
For years, Ripple has been held down by an extensive legal dispute with the U.S. Securities and Exchange Commission (SEC) over whether or not XRP qualifies as a security. With the change of administration, however, the future of this lawsuit seems brighter. The head of the SEC, Gary Gensler, has announced his intention to leave the position soon. The chatter around the crypto community is that the SEC may no longer be interested in pursuing regulatory action against Ripple.
Even better, the Trump administration is rumored to put the Commodity Futures Trading Commission (CFTC) in charge of regulating cryptocurrencies. This would be especially music to the ears of XRP investors, as the SEC has often been seen as a crypto-skeptic and critical of XRP.
ETF-Powered Boost
XRP's second major catalyst is the possibility of an exchange-traded fund (ETF) launching next year, featuring XRP's spot price. On December 2, New York-based investment firm WisdomTree became the most recent big player to file for a spot XRP ETF with the SEC. The application arrives following a similar filing by 21Shares in November.
Currently, both WisdomTree and 21Shares offer spot Bitcoin ETFs. Their decision to expand into XRP ETFs is a positive sign. There's even talk that the $10 trillion asset manager BlackRock (of iShares Bitcoin Trust fame) might join the XRP ETF race.
How High Can XRP Go?
The big question is, where will XRP hit its summit? XRP has burst past several technical analyst's predicted price support levels in scarcely a month. At $2.73, XRP seemingly lies within reach of its all-time high of $3.84, achieved in early 2018.
It's challenging to pin down an exact XRP valuation in the current situation. The optimistic view provides that most of XRP's regulatory issues are now in the past. If a spot ETF gains the SEC's approval in 2025, XRP might reclaim the $3.84 level without difficulty.
The über-optimistic estimate for XRP suggests it could break through $20, resulting in an eye-popping 7-fold increase from its current value. Veteran trader Peter Brandt, for example, has set a target of $24 for XRP.
Factors that could propel XRP to such unfathomable heights include Ripple's rumored launch of a new stablecoin in December. If the launch goes smoothly, it could attract substantial Wall Street financial institution involvement within the XRP blockchain ecosystem.
To Buy or Not to Buy XRP
With the upsides looking so tempting, you might be tempted to jump aboard the XRP train. Just think twice - XRP has soared by more than 400% in less than a month. If you find Bitcoin overheating with a 40% increase in only 30 days, imagine how quickly XRP could cool off if the market turns sour.
So, do your homework if you're contemplating an investment in XRP. Keep in mind that it remains a highly speculative and wildly volatile investment. Longtime XRP investors might still want to hold on to their shares and observe what transpires. However, if you're new to the game, you may have missed out on one of the most spectacular post-election crypto rallies in history.
In light of the potential regulatory changes and the possibility of an XRP-backed ETF, investors might consider exploring opportunities in the financial market for XRP, focusing on its investing potential. With the regulatory shadows lifting and the prospect of a favorable regulatory environment, XRP's future in finance continues to garner significant interest.
