Image generated by CariGold
Will XRP Ever Reach $10? Key Points
XRP is still just a $2 crypto, but hope springs eternal in the crypto market. So will XRP ever reach $10? The answer is "yes," but it will likely take several years before it happens.
A lot needs to go right for XRP to quintuple in price. In April, cryptocurrency exchange Bitget set a $10 price target for XRP. XRP has several key catalysts to make it happen.
Regularity clarity
The first major catalyst is "regularity clarity." The U.S. Securities and Exchange Commission (SEC) is dropping its long-running case against Ripple, the company that launched the XRP token. That SEC case has been hanging over Ripple and XRP since December 2020.
Under the Trump administration, the SEC is taking a more crypto-friendly approach. At the end of June, both Ripple and the SEC agreed to drop all further appeals in the case, bringing the legal drama to an end.
As Ripple Chief Executive Officer Brad Garlinghouse pointed out on social media, that's going to free up Ripple to go back to business as usual and remove the regulatory cloud that had been hanging over XRP for years.
New spot ETFs
This regulatory clarity is also going to make it possible to launch new investment products for XRP investors. The one product that these investors want is a spot XRP exchange-traded fund (ETF) similar to the spot Bitcoin ETFs. This would enable them to buy XRP indirectly via an ETF and not have to buy XRP directly in the spot crypto market.
Right now, the thinking is that these spot ETFs will appear in the fourth quarter (Q4) of this year. Online prediction markets currently give them a 78% chance of being approved by the SEC this year, so it's really just a question of "when" and not "if" they appear. When they do, get ready to see a tsunami of new money flowing into XRP.
Innovative new financial products from Ripple
The core business of Ripple is fast, cheap, and secure cross-border payments using the XRP blockchain. However, there's plenty of room for future growth in emerging new areas. If XRP is ever going to reach a price of $10, it's going to come from these new areas of growth.
There are several key areas that could drive XRP's price higher. One of these is stablecoins, which have become the hottest growth segment of the crypto market this year.
In December, Ripple launched a stablecoin called Ripple USD, pegged 1:1 to the U.S. dollar. This stablecoin makes moving dollars to the XRP blockchain much easier for financial institutions and could spur additional adoption of XRP. In just over six months, this Ripple stablecoin has already hit a valuation of $450 million.
Competitive threats to XRP
Financial innovation is happening at a blistering pace right now in the crypto market. Under the Trump administration, many of the traditional strictures for crypto are being dismantled, and new products are launching at a furious pace. Any one of these new products has the chance to blindside Ripple (XRP).
For example, JPMorgan Chase, in partnership with Coinbase Global, recently introduced a token called JPMD that sounds a lot like what XRP was supposed to offer big financial institutions. It will be used on the Base blockchain created by Coinbase, and one of its key use cases will be cross-border payments.
That's bad news for XRP investors. JPMorgan Chase has decided to use a completely different token and a completely different blockchain for cross-border payments, suggesting that the path to mainstream adoption for XRP is going to take longer than many expect.
Is a $10 price realistic?
At the beginning of the year, a $10 price for XRP seemed like a no-brainer. At the time, XRP was up nearly 600% since the election and was trading at about $3.40. But XRP has fallen back to the $2 range and is having trouble establishing new momentum.
The good news is that online prediction markets still give XRP an 18% chance of hitting the $4 mark by the end of this year. If XRP manages to hit $5 this year, then it will become much more likely that it will hit the $10 mark within the next few years.
Keep your eyes on the next six months. These could be critical in determining just how much higher XRP can go.
Should you invest $1,000 in XRP right now?
Before making a decision:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now, and XRP wasn’t one of them.
Consider when Netflix made this list on December 17, 2004, if you invested $1,000 at the time of our recommendation, you’d have $713,547! Or when Nvidia made this list on April 15, 2005, if you invested $1,000 at the time of our recommendation, you’d have $966,931!
Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
This article has been published in fool.com via Yahoo News.
