Over the past week, Ripple’s digital token XRP has been one of the most trending cryptocurrencies on social media after printing a meteoric rise of about 50% within a week. With the retail frenzy gaining strength, bag holders are asking about the possibility of XRP sustaining the massive rally.
According to an article recently published by Finance Magnates, a wide range of indicators need to be considered. The first indicator is XRP network activity, the second is the development in Ripple versus the SEC lawsuit, and the last indicator is the adoption of XRP in the global financial ecosystem.
Analysts Believe the Final Outcome of Ripple-SEC Case is the Major Indicator
Most analysts who spoke with Finance Magnates believe it’s possible for XRP to sustain the recent bullish momentum, but the final outcome of the lawsuit between Ripple, the major distributor of XRP, and the United States Securities and Exchange Commission (SEC), will have a major impact on the price of the digital currency in the long-term.
The Chief Executive Officer at Pure Fintech, Daniele Casamassima, believes that the latest optimism in Ripple versus SEC lawsuit is the strength behind the recent price jump.
Casamassima noted:
“The price of XRP reached $0.90, making it one of the best performers in the past week with a growth of almost 50%. The payments token regained a market cap of $40 billion, moving above Cardano’s ADA and Solana’s SOL. The recent price surge is mainly due to the possible outcome of its lawsuit against the US Securities and Exchange Commission. Traders anticipated that the currently sealed legal documents would show that the crypto company got legal advice from an outside law firm which concluded that XRP were not securities.
“Some analysts say those developments suggest the case is coming to an end, which could cause further appreciation in XRP’s price. Others, however, say XRP could lose favor among investors because newer payments tokens now exist in the market. Ripple published the quarterly XRP Markets Report for Q4 2021 to voluntarily provide transparency and regular updates on the company’s views on the state of crypto markets such as quarterly XRP sales and relevant XRP-related announcements.”
Read Also: XRP Surges Over 20% in Less down A Day as Ripple-SEC Lawsuit Reaches Crucial Turning Point
Speaking about XRP with the Finance Magnate, Farah Mourad, a Senior Market Analyst at XTB MENA, pointed out that XRP has a very strong presence in the global payment network due to its energy-efficient nature.
Mourad said the ongoing lawsuit between Ripple and the SEC is expected to add pressure on the price of XRP, but urged investors to focus on the long-term aspect of the project:
“What should be more important for investors, is the long-term aspect of the project; the technology, venture capital, efficacy and actual utility. XRP token provides a strong global payment network while being one of the top energy-efficient cryptocurrencies (with 0.0079 KWh per transaction) and with XLS-20 on NFT-Devnet, the token could benefit greatly. Daily price fluctuations are nothing more than noise. But, a judgment leaning in Ripple’s favor would bring more stability and maturity to the token. We still believe it’s the most probable scenario.”
Another Opinion on the Key XRP Price Drivers
However, Maria Stankevich, the Chief Business Development Officer at EXMO UK, has a different opinion regarding the reasons for XRP’s price jump in the market.
Read Also: Flare CEO Updates XRP Holders on When to Expect Spark Token Airdrop
Stankevich said the airdrops announced for XRP holders just before the jump was also one of the reasons behind XRP’s recent price jump:
“All XRP holders received Sologenic (SOLO) project tokens for free. So, we saw a surge in active addresses in the cryptocurrency network, which began in mid-January. Such data was provided by the analytical company Santiment.
“According to analysts, activity on the XRP network is currently at an all-time high, which was last seen in November 2021. By the way, the snapshots of the Ripple holders, which determined the right to receive SOLO, were made back in December 2021, causing a six-fold increase in the token rate, after which it returned to its original rate, losing all profits.”
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