Trying to make a ripple price prediction is sort of like throwing a dart at a dartboard these days, except for one thing. Rather than bouncing around, the cryptocurrency’s price has been shooting upward at a breakneck speed. As a result, making a ripple price prediction is difficult merely because predicting how much it will rise in a day’s time is nearly impossible, although a second risk is calling the top of the cryptocurrency’s climb.
XRP may have toppled bitcoin’s dominance
The value of ripple coins, technically known as XRP, is up by more than 100% in a week after hitting yet another record high. In fact, the valuation may have sneaked up on even those with the expertise to attempt a ripple price prediction because suddenly, the digital currency looks in a position to challenge the dominance of the first viable cryptocurrency, which is bitcoin.
According to CoinMarketCap, the value of a ripple coin is up to $2.84, putting the digital currency’s market capitalization at $109.85 billion. According to MarketWatch, the digital coin’s true market cap stands at more than $260 billion when including the 55 million coins held by XRP developer Ripple Labs in escrow. As a point of reference, the value of a single bitcoin stands at $15,167.90, which puts the digital currency’s market cap at $254.51 billion.
The problem with using market caps to compare cryptocurrencies
Of course, there’s a huge problem when trying to compare cryptocurrencies by looking at their market caps, which is evidenced by the huge difference in the two calculations of ripple’s market cap. It’s unclear just how comparable XRP’s $260 billion+ market cap is with bitcoin’s approximately $255 billion market cap.
However, we do know that the anonymous creator of bitcoin was believed to be holding a sizable amount of the cryptocurrency, so theoretically, there’s a decent number of those digital coins that aren’t in circulation, making it difficult to know just how large bitcoin’s market cap really is.
Ignoring the market cap to make a ripple price prediction, it becomes even more necessary to look elsewhere for catalysts driving the valuation skyward. Ripple Labs developed its blockchain protocol XRP in 2012 as a payment system targeted at financial institutions and firms. MarketWatch describes it as the one cryptocurrency with “the most legitimate business model from a Wall Street perspective.”
Why is the XRP price soaring?
One reason why the digital currency’s price has skyrocketed recently is because several financial institutions in Asia have signed up to try out the XRP digital payment system developed by Ripple Labs. This brings the firm’s number of financial clients up over 100; that client list includes many big names such as UBS and American Express.
The firm claims that payments processed in XRP are completed in only four seconds, making it the fastest major cryptocurrency, reports CNBC. In theory, this could make this digital currency even more viable than the bitcoin network, which takes a much longer time to process transactions.
Many cryptocurrency traders are also making speculative purchases based on their own ripple price prediction due to rumors that well-known digital currency exchange Coinbase will soon support XRP coins. The ongoing rotation out of bitcoin into other cryptocurrencies has also helped XRP.
Check out these ripple price predictions
Analysts bold enough to slap price targets on digital currencies are rapidly changing their predictions. Profit Confidential contributor Gaurav Iyer raised his prediction from $2 to $10 on Tuesday, citing “an explosion” in trading volumes, broader media coverage and ore use-cases for XRP coins outside the finance industry.
Coin Telegraph, on the other hand, remains conservative on the digital currency after predicting on December 30 that a correction or consolidation is coming soon because of the strong rally. The blog followed up on Tuesday by noting that the consolidation lasted only about a week as bulls pushed XRP out of the previous resistance level at $2.10 and predicted a raise to $2.474. The digital currency has already blown past that level and continues to rise steadily. Coin Telegraph set two important support levels at $1.80 and $1.60.
So can XRP continue to soar or will it hit a ceiling and go the way of bitcoin? It could be a while before we truly know the answer to this because of how inexpensive it is on a dollar basis relative to bitcoin. However, Forbes contributor Jesse Damiani argues that XRP could be insulated from some of the volatility surrounding other cryptocurrencies because it is useful in its current form. Most other cryptocurrencies, on the other hand, are bought and sold mostly on speculations about the future. Ripple Labs also holds 20% of the total supply of XRP coins, which could also provide support for their value.
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