In the last article that I posted, I had talked about why there was a large cryptocurrency crash in the market at the time. I talked about new tariffs being enacted by the new US President that had everyone spooked.
Well, since that time, the crypto market has somewhat stabilized though there have been swings up and down as well. One of the big crypto’s that took a dramatic drop before rebounding is XRP. It dropped all the way to around $1.70 before going back up around the $2.30 to $2.40 range. Since it has moved back into that range, it really hasn’t moved much even though there’s been a lot of good news centered around XRP.
The question them becomes, has XRP reached its peak? I certainly don’t believe so, but in order for it to really move upwards again and get back over $3.00, there are at least four things that need to happen and we’ll be taking a closer look at each of those today.
The SEC/Ripple Lawsuit and Appeal Needs to Officially End
This lawsuit, in my opinion, is the biggest thing holding XRP back from reaching and surpassing its all time high. This lawsuit has been going on for over four years now and was issued by the SEC from the head chariman before Gary Gensler. It was in fact, his final act before leaving the SEC.
Gary Gensler not only went full force into the lawsuit against Ripple (the company responsible for XRP right now) when he took over, he caused the SEC to launch a multiude of lawsuits against other crypto companies citing that most cryptocurrencies are securities. Some of the companies tried to settle with the SEC while others, such as Ripple and Coinbase, decided to fight back. We know that Ripple scored a large, partial victory against the SEC, but the SEC decided to appeal it thus dragging this pointless lawsuit out even longer.
While the price of XRP finally broke out to at one point, a price over $3.00 within the last couple of months, it would more than likely be much higher if the lawsuit was never brought forth or had already ended. I don’t know if many people remember, but when the lawsuit was first issued, many crypto exchanges delisted XRP which even included Coinbase. The only major exchange within the US that continued to have it listed was Uphold.
There is good news though. The winds of change have hit the SEC and they are now turning VERY pro crypto. With Donald Trump elected president, and he’s stated many times he wants crypto to flourish in the United States, the SEC’s war with crypto is coming to an end. Gary Gensler has since resigned and even some recent developments have also surfaced within the SEC. The lawyers responsible for many of the crypto lawsuits have been re-assigned elsewhere including it’s top lawyer who has been re-assigned to IT. What does this mean? It means that the SEC is preparing to end its nasty anti crypto stance and move into a much more crypto friendly environment. My guess is when Paul Atkins is sworn in as the new chair of the SEC, he will either settle with Ripple or fully remove its appeal of the lawsuit. Once this happens, look for XRP to move up quickly.
XRP Needs to Become Part of US Crypto Reserve
There has been a lot of talk about creating a US Strategic Reserve of Cryptocurrency. It initially centered around just Bitcoin, but it has kind of evolved into the addition of other cryptocurrencies, especially XRP. This has caused kind of a rift within the cryptocurrency community between Bitcoin and XRP.
Since Bitcoin is the first and largest of all the cryptos currently, I can certainly understand why many people prefer just Bitcoin to be the only one in a strategic reserve, but it doesn’t make a lot of sense just to have only one. There are others out there that have great utility and promise to transform the financial industry and XRP is definitely one of those along with XLM, HBAR, and a few others.
While the US Government has announced that they are looking into the feasibility of a US Digital Asset reserve, there is no time table on when that will actually come about or which crypto’s will be a part of it, but my guess is if when it does finally come around, since XRP and the company Ripple is US based, I could see it being announced as one of the big ones to be a part of a US reserve. That would also cause the price of XRP to rise dramatically.
Since there is an official crypto taskfroce or crypto czar in the US now, I believe that one of the things needed to bring about a digital asset reserve in the US is cryptocurrency regulation and I’ll talk more about that here in a bit. I do believe there will be an official announcement of the creation of digital asset reserve before the end of the year and that XRP will be one of the assets to be a part of it. There’s just too much financial utility within XRP for it not to be a part of that reserve. We definitely need to stay tuned for this.
XRP ETFs Need to Be Approved
Ever since Gary Gensler stepped down from the SEC, the number of XRP ETFs exploded with even more just filed this past week. One of the biggest of them all is Grayscale’s ETF and there are big rumblings that the SEC could either be approved before February 14th or just acknowledged, but delayed a bit longer before approval. This certainly bares watching.
ETFs stand for eletronically traded funds and are the easiest way to get into crypto investing without actually owning cryptocurrency. There are currently two cryptos that have had approved ETFs and they are Bitcoin and Ethereum. The Bitcoin ETFs have been a boon for the coin, but not a lot has happened with Ethereum ETFs.
There are at least six XRP ETF filings and they are from Bitwise, 21Shares, Coinshares, Canary, WisdomTree, and Grayscale and Grayscale appears to be the largest of them. While I do think that that some of these XRP ETFs will be approved, especially Grayscale’s, it will be interesting to see if they are approved before the SEC’s appeal of the lawsuit is over with or afterwards. If I were the SEC, I would approve at least one or 2 of them right now as a massive signal that the SEC is ready to put its war with crypto behind them and move forward with making the crypto industry flourish. I think this would send the clearest message yet that they are eager to do this and show that they are going to end its lawsuits of non-fraud cases against crypto companies.
Now it’s time to take a look at the last major piece needed to cause XRP (and other cryptos) to reach new heights. The next one is quite important because it’s truly how the crypto markets and industry will move forward and grow instead of being hindered.
Cryptocurrency Regulation Needs to Be Created
The single biggest thing missing from the crypto markets and industry are clear cut regulations, as in rules of the road that can be followed and with precision. Right now there is a great lack of regulations and so multiple government agencies have debated and even argued which one has jurisdiction over cryptocurrencies from the CFTC to the SEC and we all know the path that the SEC chose when it came to cryptocurrencies.
With clearcut regulation for digital assets, it will no longer be a question of whether a crypto is a security, commodity, or something else. They will know and have regulations to go by instead of vagueness or nothing to follow at all. With the SEC’s numerous lawsuits against crypto firms, one in particular stood out (not actually talking about the Ripple/XRP case here) which is where the SEC went after Coinbase, the crypto exchange, for supposedly allowing securities to be listed on their exchange.
Coinbase fired back by sending a letter to the SEC asking for clarification on what is deemed a security and how it can abide by the rules of the road in that regard. The SEC remained silent and sent them back nothing. Because of that, the former chair, Gary Gensler, and the rest of the SEC took MAJOR heat for that and was even grilled in Congressional hearings of why the SEC chose not to respond to a company that clearly wanted to know what the rules are so they can abide by them and get out of the litigation with the SEC.
Because the SEC had no rules of the road for crypto, it didn’t respond, plain and simple. The good news is, multiple agencies and the new Presidential administration recognize the need for crypto regulation that will help crypto flourish, but also help to reduce scams and creation of cryptocurrency that doesn’t serve a major purpose or just created to take a lot of people’s money. Sadly, there have been many cryptos supposedly created and then launched as a pre-sale, promising big things, only to have the rug pulled from underneath people’s feet and suddenly vanished. Sadly, I’ve fallen for 2 of those type of scams and hopefully with clear cut regulation, this will help put a stop to it.
With full scale regulation, I believe we will also see which government agency that cryptocurrency will fall under or it could be multiple agencies depending on the classification of specific cryptocurrencies. Both the SEC and CFTC have claimed jurisdiction of a lot of the cryptos out there and so it will be interesting to see which one of them will have more control over them. Once all this happens, folks the floodgates are going to open like never before into crypto. Institutions especially are going to pour in like nothing we’ve ever seen and I think retail come screaming back shortly afterwards. It’s going to take some time, but this will likely happen within the next few years.
Conclusion: XRP Will Reach New Heights
There are a lot of people who are saying that it is unlikely that XRP is going to get much higher than it is now, but lots of people said the same thing months ago when it was $0.75 and lower and then it suddenly shot up to over $3.00. Patience is needed here as there is so much positive momentum happening with XRP right now.
Once these four things that I mentioned above happen, XRP is going to take off like never before because of its massive utility. I honestly believe 2 of the 4 things mentioned will happen this year. I believe the SEC lawsuit and appeal will come to an end and I believe at least one or two XRP ETFs will get approved. Those will be two big catalysts right there.
I am not a financial advisor and if you invest in crypto, you do so at your own risk. With that being said, this is one of the best times to get into cryptocurrency in XRP. You have a chance to get in ahead of Wall Street and many large investment firms and hedge funds because they honestly want as much retail (people like you and me) out of it as possible, because they want to be in control of cryptocurrency as much as possible because they know its potential for the future especially with the underlying technology behind it which is blockchain.
They know this has the potential to chane the financial realm of the entire world as well as other industries and this is why the big institutions are foaming at the mouth to get into it. Cryptocurrencies are the newest asset class of the world and it continues to gain so much momentum. People want to become rich overnight with crypto and its just not going to happen the way they want it to, but if you don’t let the bad news and the volatility of the market sway you, you hold firm and patient, you’re going to be in the right place at the right time when these things I talked about come to pass and the crypto market moves like never before. Patience is very key here as I’ve held XRP for over seven years now, and for the first time, I’m now holding on to profit from it, but will continue to hold on to XRP because the future looks very bright for it.