There is an environment that favors the rise in the price of XRP.
XRP is 70% below its all-time high, reached in 2018.
XRP seems to have returned stronger than ever after a break that lasted for 3 years. Wow, time has passed!
It is that the last time the quote of the cryptocurrency issued by Ripple Labs was above 1 dollar was in November 2021. Now, part of its community is eager to know what will happen to the price of the digital asset in the coming months.
Although making an accurate prediction in a market as volatile as that of digital currencies is complicated, it should be noted that the recent rally allowed XRP to position itself as the sixth most valuable assetdisplacing dogecoin (DOGE).
At the time of publication of this note, the price of the digital currency is $1.12, as seen in the following chart. TradingView.
For pessimistic investors, in the midst of so much expectation, we can tell them: yes, they are right. The price of the asset currently is 70% below its all-time high (ATH) of $3.84 reached in January 2018.
However, there are sufficient reasons to believe that the price of XRP may enter a bullish cycle in the short term.
Next, 5 fundamental reasons why the price of cryptocurrency will continue to rise.
1.Trump’s triumph in the United States elections
As CriptoNoticias has reported, the victory of the Republican leader over Kamala Harris, candidate for the Democratic Party and current vice president of Joe Biden, generated bullish sentiment in the digital asset market.
Throughout his campaign, Trump expressed a stance in favor of cryptocurrencies and even promised to promote the creation of a strategic reserve of bitcoin (BTC). Besides, He assured that in his second term there will be regulation friendly to the sectorwith the aim of promoting its growth.
In this context, Brad Garlinghouse, CEO of Ripple Labs, assured that he was not surprised by the market’s response to Trump’s victory. In an interview with Fox News explained the reasons and said:
«The cryptocurrency industry has embraced Trump; Trump has embraced the cryptocurrency industry. “I think he’s very genuine, and I think he sees the opportunity, he sees the innovation, he sees the entrepreneurship – I’m very excited about what the future holds.”
Brad Garlinghouse, CEO of Ripple Labs.
In recent days, there have also been strong rumors about a meeting between Trump and Garlinghouse to begin outlining the first measures to promote the development of cryptocurrency projects on US soil. It is worth clarifying that neither party confirmed the meeting.
However, for these initiatives to be realized, There must be changes in the leadership of the Securities and Exchange Commission (SEC).
2.The possible departure of Gary Gensler
The departure of the current head of the SEC, Gary Gensler, could mark a change of era, providing greater clarity in how to address issues of innovation and regulation of cryptocurrencies in the United States.
Although Trump had promised to fire Gensler, the truth is that he does not have the power to do so. However, there are indications that he will present his resignation before the businessman begins his new stage in the Oval Room of the White House.
As CriptoNoticias reported, weeks ago, the still president of the regulatory entity gave a farewell speech and stated that “It was a pleasure” to have served the federal agency.
During his tenure, Gensler adopted a persecutory attitude against the sector and even filed lawsuits against exchanges such as Binance, Kraken and Coinbase, for marketing a dozen digital assets that were considered by the SEC as unregistered securities (securities), which prohibited its sales.
Although he later removed that qualification, The reality is that the lawsuits implied significant economic costs for those firms.in some cases, up to 400 million dollars.
In the case of Ripple, it also had to face a judicial process against the SEC for marketing XRP through exchanges.
The US Justice determined that the asset can only be considered a security in specific circumstances, such as institutional sales. Far from accepting this resolution, the SEC appealed the decision, extending the conflict between the parties. Now, with Gensler’s departure, The legal dispute could have a happy ending for Ripple Labs.
Another issue to highlight is that with an administration willing to work in tandem with industry players, there could be more clarity about which cryptocurrencies are considered a security and which are not.
This could help the launch of more cryptocurrency-based investment products.
3.Applications to launch an XRP ETF
At the moment There are three companies that filed the application with the SEC to list an XRP-based exchange-traded fund (ETF).
These are the asset management firms 21Shares, Canary Capital and Bitwise. In their requests, it is clarified that the digital asset is not a security and constitutes one more option to diversify the cryptocurrency investment portfolio.
So far, none of these requests have been responded to by the SEC. A change in management could accelerate the launch of these financial products to the marketwhich could increase the liquidity and accessibility of more traditional investors to XRP.
As CriptoNoticias has explained, the good performance of ETFs has a direct impact on the price of the underlying asset, in this case XRP.
Due to their operation, the companies that manage them must keep the asset in their treasuries to support their actions. Thus, by simple law of supply and demand, that causes its price to rise.
4. States sue the SEC for persecution
The attorneys general of Kentucky, Nebraska, Tennessee, Virginia, Iowa, Texas, Mississippi, Montana, Arkansas, Ohio, Kansas, Missouri, Indiana, Utah, Louisiana, South Carolina, Oklahoma and Florida, joined together to file a lawsuit against the SEC and its commissioners.
In the letter, they argue that the regulatory entity unconstitutionally exceeded and unfairly persecuted to the cryptocurrency industry.
Although the departure of Gary Gensler marks the end of that persecution, the lawsuit has future relevance, as it could set significant precedents for the regulation of cryptocurrencies in the United States.
Furthermore, a favorable ruling not only benefits companies in the sector, but also sets clear limits for future regulatory actions. In other words, it serves as a protective shield for the industry, in case new actors emerge with an adverse stance towards digital assets.
In turn, it could decrease the perception of risk associated with investing in cryptocurrencies, which could attract more capital and institutional participation in the market.
5. Pro-cryptocurrency Congress
The great election that the Republican Party made will allow it to take control of both Houses of Congress. In this way, Trump has the legislative power necessary to carry out his plans from the White House and to be able to fulfill their promises with the laws to promote the growth of financial products based on bitcoin (BTC) and the rest of the cryptocurrencies.
An example of this is the FIT21 law, which includes the definition of a series of concepts that were not clear to the industry in that country and that were reasons for most of the lawsuits mentioned above that the SEC promoted. Among them, highlight the elements that allow a digital asset to be identified as a security or merchandise (commodity).
The FIT21 project was approved in majority in the House of Representatives, but has not yet been debated in the Senate.
Finally, it is worth noting that Ripple Labs continues working on the launch of the RLUSD stablecoinwhich will work on the Ethereum network and the XRP Ledger.
This novelty adds to other developments promoted by the firm such as projects for cryptocurrency education and the platform allows governments, central banks, financial institutions and other state entities to issue their digital currencies (CBDC).
After a long nap, The future looks brighter than ever for XRP. Wow, time has passed!
Disclaimer: The views and opinions expressed in this article belong to its author and do not necessarily reflect those of CriptoNoticias. The author’s opinion is for informational purposes and under no circumstances constitutes an investment recommendation or financial advice.
