Ripple may be one of the hottest cryptocurrencies on the block(chain!), but the Ripple price has taken a bit of a kicking recently. This highly tipped digital currency had reached a high point in excess of $3, but has receded in the last few days to little more than $1.20.
The Ripple price has very much reflected the cryptocurrency niche as a whole, with both Bitcoin and Ethereum also struggling against market forces. The market capitalization of Ripple has also fallen to $46 billion, which is almost half of its peak in this department.
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However, there are some plus points for the future direction of the Ripple price. French Crédit Agricole intends to test the cryptocurrency system and blockchain associated with Ripple, with the intention of “speed[ing] up cross-border credit transfers carried out by its customers working abroad.” The bank has already indicated that the test will last six months, with responsibility being taken by Crédit Agricole Payment Services.
Further details have also been revealed, with the bank noting that the new arrangement “will cover salary transfers in Swiss francs for some cross-border customers, between regional bank Crédit Agricole des Savoie and Swiss bank Crédit Agricole Next Bank.”
Although this will be a long-term project for the bank, an update has been promised at the Paris Fintech forum, which will take place on January 30. Certainly the long-term upside for the Ripple price is reliant on the cryptocurrency being accepted by the mainstream financial system, with its blockchain viewed as a very useful mechanism of exchange.
The correction in the Ripple price must be seen in the broader climate of cryptocurrencies. The market-leading Bitcoin has already seen the Bitcoin price shaved by over 40%, with the digital payment system currently trading at around $11,000. Meanwhile, Ethereum has also receded back to just over $1,000.
There are a wide range of opinions on the cryptocurrency niche in general, and Ripple in particular, and this makes Ripple price predictions particularly difficult to make. Some people believe that its attractiveness to the mainstream financial system will be bullish for price discovery, while critics are significantly more hostile towards this payment system.
Joseph Lubin, founder of ConsenSys, was particularly scathing about the potential, or lack thereof, or Ripple. “Effectively it’s a totally useless token except that it is being used by that company to make a lot of money to fund some of their activities,” Lubin asserted.
Naturally, the CEO of Ripple, Brad Garlinghouse, strongly disagrees with this view, and believes that Ripple will be accepted by the existing financial elite as a valid and valuable money transfer system. “Ripple is trying to be a catalyst to mature a whole industry. The current system is fraught with friction and is measured by a lack of transparency and speed.”
However, Ripple is not necessarily accepted by even those who are favorable towards cryptocurrency. Many believe that the decentralized nature of Ripple means that it shouldn’t be bracketed with solutions such as Bitcoin. Jens Bader, co-founder of payment company MuchBetter, is one such critic of this payment solution.
“Ripple is somewhat off the pace, both in terms of its market position and its identity as a cryptocurrency. It might be a good complimentary currency to bitcoin and Ethereum, but since it is a centralised system, it does not live up to the brief of what a cryptocurrency is meant to do, and the USPs of blockchain technology.”
And while Greg Adams, proprietor and managing director at blokt.com, recognises the potential of Ripple to be used in international transactions. “Ripple was designed to provide cross-border settlement between banks. It is solving the problem of slow settlement speeds and high operational costs,” the blockchain expert also questions the short-term potential of the Ripple price. “However, XRP is centralised and was not intended for retail use, it already has an extremely high valuation so I would advise prospective buyers to steer clear for now,” Adams commented.
Although Ripple undoubtedly faces a challenging climate at present, more companies are embracing its potential. The blockchain software is undoubtedly particularly aimed at banks, and the creators of the currency have announced that a currency exchange firm, along with a telecom provider, will be the latest to utilize the currency as part of money transfer operations.
IDT Corporation and MercuryFX will lend further credibility to Ripple, which is important considering that the authorities are beginning to propose legislation to clamp down on the cryptocurrency sphere. This could actually be one of the biggest advantages for Ripple, as the establishment has been relatively enthusiastic about the blockchain, and would certainly welcome a decentralized solution such as Ripple.
It is difficult to project the future Ripple price, as many different factors are impacting on its potential. Some believe that cryptos in general are vastly overvalued, and Bitcoin has certainly experienced a massive price increase in a short period of time. While this suggests that its acceptance into the mainstream financial architecture is forthcoming, this will certainly need to occur in order for the Ripple price to explode.
Whether the bullish or bearish sentiments turn out to be correct will be unveiled in time. But in the short-term, there is no doubt that the likes of Bitcoin, Ethereum and Ripple will continue to generate headlines.