As its legal battle with the SEC starts to tip in Ripple’s favour, can XRP finally retake the number three spot?
Ripple was one of a triumvirate of massive cryptocurrencies in the recent past, alongside Bitcoin and Ethereum. This is perhaps no longer the case, with other cryptocurrencies having overtaken Ripple in recent years.
But Ripple nevertheless remains one of the most recognisable cryptocurrencies, and has already been backed by several banks and financial institutions due to its credibility in cross-border payments. This means that Ripple remains firmly entrenched within the top 10 cryptocurrencies in the world, and the token has thus attracted billions of dollars in investment.
Thus, in this article, we’re going to assess the trading prospects for Ripple in 2021, after what has been a successful, if dramatic, period for cryptocurrencies in general.
Current Ripple price
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Ripple has already experienced an eventful 2021, having reached a peak price of over $1.80, which was nearly 9 times the price that it began the year with. The token has since corrected in value somewhat, but has still experienced an excellent trading year overall.
Ripple has gone against the grain of the many other cryptocurrencies during 2021, increasing in value during what has generally been a mini-bear market. This is not the first time that this has occurred, though, with Ripple having a different ethos and direction from some of the other major cryptocurrency projects.
One of the issues that has impacted on the decline in value of Ripple in 2021 is the SEC lawsuit against Ripple Labs – the developers of the token. The Securities and Exchange Commission has taken legal action over what it believes to be unregistered digital asset securities offerings. Recently, the SEC issued a motion requesting for the judge presiding over the case to extend deadlines for factual and expert discovery by 60 days.
Source: Coinbase
This has undoubtedly created some uncertainty around Ripple, although 96% of all SEC cases are settled before trial, and many believe that the case will never get anywhere near a court. Regardless of this, the case will set a significant precedent for the cryptocurrency ecosystem worldwide, and the ongoing legal battle is naturally being watched extremely closely.
As a consequence of the issue, the price of Ripple has fluctuated a little, with traders somewhat uncertain about the future direction of the currency. Ripple has staged a small recovery recently, but its growth has lagged behind some of the other cryptos in the space, such as Dogecoin and Binance Coin.
However, many market observers have sided with Ripple in the SEC legislation, and the long-term impact of this issue may ultimately be rather minimal. It is also positive that Ripple has already forged strong relationships with many aspects of the mainstream financial architecture. With many of the SEC’s motions being dismissed in recent months, the case could end up being bullish for XRP.
Ripple Price Forecast
Technical analysts have noted that current Ripple price movements are particularly interesting for the token going forward. Ripple recently achieved a 15% gain in a single day, which would obviously suggest that the bear market for this token is receding.
However, there are some mixed messages as well. Ripple’s daily active addresses fell by 83% from its April 12 peak of nearly 50,000. This indicates a diminishing in the interaction and activity associated with the token, which can tend to lead to reduced trading volumes. Equally, Ripple’s Network Growth declined from 12,373 on April 19 to 3,172 as of May 31; a fall of over 70%.
Source: Coinbase
Nonetheless, technical analysts have noted that the recent pattern of trading for Ripple suggested it is reaching a position of fundamental support. In this scenario, its current price would effectively form a base for the token in trading, and it would begin to inch upwards, reclaiming its peak value steadily.
Obviously, the outcome of the SEC case is considered critical for the future of Ripple, although most market observers expect this to be fairly favourable.
Ripple Price Discovery in June
In recent trading, the Ripple price has experienced significant resistance at the $1.10 level. This is significantly lower than its peak value achieved earlier this year, which suggests that Ripple has encountered some trading difficulties.
But analysts believe that if the token can break through this psychologically important barrier that its value will probably increase significantly, with a short-term price target of just over $1.30 having been mentioned in some quarters. This could be achieved relatively quickly, and would represent a 26% increase in the value of Ripple in a relatively short time frame.
Another bullish factor for Ripple is the 30-day Market Value to Realized Value model — an index used to measure the average profit and loss of investors who purchased Ripple during the last month. This currently indicates that Ripple is in an opportunity zone, and that investors could possibly be advised to purchase the token.
This is providing long-term investors with the opportunity to purchase Ripple tokens at a low in the market. From a technical perspective, the price of Ripple is currently in a safe zone, with the value not likely to decline much in the immediate future. This certainly represents a buying opportunity for those who believe in the long-term credibility of the token.
The macroeconomic picture for the planet should also be taken into consideration, and this remains complex and nuanced. While there has been something of an economic recovery, this is undoubtedly uncertain and unstable, which means that cryptocurrencies could remain excellent commodity investments in the months to come. Certainly, cryptos have unequivocally benefited from the financial climate associated with the Covid pandemic and related lockdown.
Cryptos are also beginning to recover from the comments of Elon Musk, the CEO of Tesla, who caused some chaos in the cryptocurrency space by criticising the electricity usage associated with Bitcoin. Now that the dust has settled on these remarks, we can expect major cryptocurrencies to recover in the coming months.
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Please note, the above is a purely opinion-based piece, based on relevant data available. It should not be deemed as direct investment advice.
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