Despite gaining regulatory clarity following a prolonged legal battle with the Securities and Exchange Commission (SEC), XRP’s price performance has remained surprisingly sluggish compared to other major cryptocurrencies. This poor performance has led pro-XRP lawyer Bill Morgan to question the reasons behind XRP’s lackluster performance.
Wow. I never realised XRP’s price performance was this poor compared to other major coins and not only compared to Bitcoin and Ethereum. It has of course been under the cloud of a SEC investigation and then lawsuit that entire period but you would think it would have caught up… https://t.co/Eyflqp0JZq
— bill morgan (@Belisarius2020) November 29, 2023
Bitcoin (BTC), which was trading at $6,420, is currently at $37,685. The other tokens highlighted on the list were Ethereum (ETH), Litecoin (LTC), and Cardano (ADA), which have all increased significantly over the last five years.
XRP is the outlier among the top cryptos on the list. It is currently trading at $0.6031, very close to its price of $0.5 from five years ago.
Acknowledging that XRP has essentially remained stagnant over the past five years while other cryptocurrencies have experienced significant growth, Morgan suggested that XRP would have likely performed better had it not been under the cloud of the SEC investigation and lawsuit.
Reasons for XRP’s Stagnation?
Morgan contested the idea that selling pressure is the sole cause of XRP’s price stagnation. He presented three points to support his position. Firstly, the quarterly release of 3 billion XRP from escrow is offset by 800 million XRP returned monthly. Ripple releases 1 billion XRP every month but locks back about 800 million tokens within 24 hours.
Morgan’s second point is that the 200 million XRP left in the market every month is insignificant compared to XRP’s daily trading volume, which he places at around 1 billion tokens. He also highlights evidence from the XRP lawsuit showing that Ripple’s share of the volume is less than 0.5%.
Finally, Morgan highlights that Ripple’s escrow release inflation rate (5.4%) is lower than that of other projects like Flare and Solana (SOL).
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Morgan also highlighted the ongoing negotiations between the SEC and Ripple regarding XRP sales to institutional investors. The resolution of these talks or a definitive disgorgement ruling could have a significant impact on XRP’s valuation.
Despite the lingering legal uncertainty, there are potential catalysts that could boost XRP’s price, such as a favorable outcome in the SEC’s appeal of the court’s decision on Programmatic Sales. A settlement between both parties or increased XRP adoption could also help.
While XRP’s price performance has been disappointing, there are reasons to be optimistic about its future.
Meanwhile, the SEC’s recent announcement of a confidential meeting has sparked speculation of the much-awaited settlement, which could significantly impact XRP’s price depending on the outcome.