One of the biggest surprises among altcoins is the Ripple price. From literally absolutely nowhere (it was initially priced at fractions of a penny), Ripple skyrocketed. For a brief moment, it was the second-most valuable token among all cryptocurrencies. Even mainstream media reported on the “banker’s coin” when just a few months ago, they eschewed bitcoin coverage.
But despite the positive technical momentum, the Ripple price took a massive beating after it hit an all-time high of nearly $4. I’m sure you’re aware of the commonly cited explanations. First, Coinbase denied rumors that it will integrate Ripple into its popular consumer-level blockchain platform. Second, the South Korean government reported that it will ban cryptocurrencies.
Obviously, these are tremendously negative factors impeding the Ripple price. Yet bitcoin and altcoins have suffered serious volatility as well; what makes Ripple’s losses stand out?
Much of the allure — and subsequent controversy — of Ripple is its big-bank friendly platform. Look at its official website, and you’ll see a laundry list of international banks supposedly partnering with Ripple. The partnerships make sense due to the superior efficiency of the Ripple blockchain. Banks want to replace the SWIFT system, and the distributed digital ledger system provides the ideal solution.
But look a little deeper into Ripple’s partnerships and you’ll discover that most of the relationships are based on loose, try-and-see approaches. The company behind the bank-friendly digital token has few solid partnerships. Once speculators realized this, they quickly backed out, sending the Ripple price crashing.
Moreover, the Ripple blockchain and its superiority over other platforms that have their own cryptocurrencies or altcoins is very much theoretical. While Bitcoin takes plenty of heat for running a slow blockchain, at least it has been proven in the battlefield. Against its competitors, Ripple potentially is light years ahead, yet this remains to be seen.
Which brings us to the biggest risk factor: if this super-fast blockchain fails to meet real-world demand, you can expect the Ripple price to crumble, and never come back to life again. Yet I wouldn’t get too negative on the controversial token at this juncture.
In my opinion, the Ripple price has at least one good rally left in it. Perhaps it will even rival Bitcoin in terms of market capitalization. I say this because cryptocurrencies are still a very alien concept to the general public. Psychologically, taking a $2 or $3 bet is far less riskier than buying a single Bitcoin at $14,000.
In the long run, though, Ripple’s true potential is a mystery. While I appreciate its blockchain’s theoretical efficiency, we already have multiple platforms that have been forged in the fire of everyday consumer demand. To me, the proven fighter makes more sense than the kid fresh out of boot camp.