XRP tokens have recently hit the spotlight after witnessing a sudden increase in its price. The cryptocurrency reached up to $2.5 which is its highest price from the past six years. XRP tokens have surpassed leading Solana and Tether leading its way towards becoming the third-largest cryptocurrency. This listing is based on the market cap value of the XRP token. The sudden surge of the XRP token has shaken the crypto industry. The recent rise has caught the sight of many investors towards the tokens.
What Do We Know About The Trending XRP Tokens?
XRP tokens are the native cryptocurrency of the XRP ledger. The XRP ledger is an open-source blockchain that was launched in 2011. The founding figures of the project were Jed McCaleb, David Schwarz, and Arthur Britton. The blockchain project was originally branded Ripple and now also the platform is most commonly referred to by this name.
The major goal of the project was to accelerate lower-cost, high-speed, and secure transactional processes. The team took inspiration from Bitcoin which also has similar goals. From the beginning itself, XRP tokens were used only for financial transactions. This is one of the main factors that make crypto tokens different from other cryptocurrencies. These essential features have also attracted many investors into investing in cryptocurrency.
What Led To The Sudden Rise In Prices Of XRP Tokens?
If we look closely into the matter, we can see that several factors have led to the sudden rise of XRP. Let us look at a few of them.
Victory Of Ripple Over SEC
In 2020, Ripple was accused of generating XRP tokens without proper registration by the U.S. Security and Exchange Commission (SEC). A lawsuit was filed against Ripple and the case went on for four years. Earlier this year Ripple won the case even though it had to pay $125 million for directly selling the tokens without any registration process. The SEC still not convinced has filed an appealing case to the court which will be reviewed by next year. The win can be considered a turning point for the crypto project. Many believe that this could be one of the reasons for the sudden rise of the XRP tokens.
Increased Institutional Demand For The Tokens
As mentioned earlier, XRP tokens were used only for financial transactions. The blockchain focuses on a much cheaper and more secure transaction process. These reasons led to the widespread adoption of the XRP tokens by various financial institutions and banks. Recently efforts have been made for a spot XRP Exchange-Traded Fund (ETF). If this happens, then the financial firms can easily invest in the cryptocurrency. The interest in XRP tokens continues to grow on a larger scale.
Bullish Market Sentiment
One of the reasons could be due to the present nature of the crypto market. In the recent times, the market seems to be bullish. It has created a healthy environment for most cryptocurrencies like Bitcoin and XRP tokens. The nature of the crypto market can influence the price movements of any cryptocurrency.
Technical Factors
The sudden rise of the XRP tokens could also be attributed to the technical indicators. Analysts spotted an increase in the 24-hour trading volume and a bullish Relative Strength Index (RSI). This in turn made the investors confident about the growth of the tokens and bet them for higher prices.
What Does The Future Of XRP Tokens Look Like?
The sudden rise in the price of the XRP tokens will impact the crypto project in much better ways. It has already attracted a large number of investors. It also created a milestone in the books of the crypto project. However crypto experts believe that the future of XRP is neutral and cannot be predicted wholly. Some say that XRP will witness potential price rises in the coming times while others think that XRP will face some challenges. The SEC appealed to the court regarding the decision passed for Ripple and this might cause some challenges to the smooth movement of the XRP tokens. The volatile nature of the crypto market could also pose a negative impact on the rise of the price.
Experts believe that there are chances that the market cap value of XRP will reach next to $5 billion if the appeal case is resolved positively and more financial institutions adopt the tokens. These situations could stabilize the position of the tokens in the marketplace.
Final Thoughts
The sudden rise in the prices of XRP tokens has sparked a discussion in the crypto industry. There was also a sudden surge in the prices of XRP tokens that happened towards the end of 2017. The bull run of 2017 became sensational news as the tokens recorded impressive numbers. Many factors led to the sudden rise in the prices of the XRP tokens. The bull run has made many investors and big financial institutions shift their focus toward investing in XRP.