Mike Alfred, a value investor, has ignited a debate with his prediction that XRP, the native currency of the XRP Ledger (XRPL), will remain stagnant at around $0.60 even if Bitcoin soars to $250,000 for the first time.
Investor Claims XRP Is Not A Scam But Will Struggle For Growth
In a post on X, Alfred said though XRP is not an “outright scam like Hex,” there are similar concerns about its underlying mechanism. The value investor continued, adding that this assessment is because XRP functions primarily as a “token printing scheme” enriching founders and insiders.
For this reason, XRP, the cryptocurrency listed across multiple exchanges, has been flat-lining for the past seven years. The investor pinned this to the excessive token minting over the years.
XRP and Ripple, the blockchain company, play different roles in the crypto ecosystem. XRP fuels the XRPL, while Ripple develops solutions to streamline cross-border transactions and address banking challenges.
One such solution is On-Demand Liquidity (ODL), which uses XRP for quick and affordable transactions, challenging competitors like SWIFT. However, ODL’s adoption hasn’t been as widespread as expected. Ripple is also involved in a legal battle with the United States Securities and Exchange Commission (SEC).
In July 2023, a United States Judge ruled that XRP distributed to retailers couldn’t be categorized as unregistered securities. The United States SEC appealed the ruling, and the case is in progress.
This week, the agency requested a deadline extension, which Ripple lawyers accepted. The strict regulator sought to push the deadline for their opening brief from March 13 to 22, citing the need for further review of recently produced documents.
Prices Stagnate As Bitcoin Rips Higher
At present, XRP is trading under pressure, priced below $0.60. Despite this, the XRP community remains optimistic. However, the coin has faced challenges primarily due to regulatory uncertainty.
XRP price trending upward on the daily chart | Source: XRPUSDT on Binance, TradingView
The immediate major resistance is around $0.85, a level tested when prices spiked in mid-July 2023. On the other hand, the coin has support at around $0.40 and $0.45. The reaction at the support zone will be crucial if the bears dominate, negating attempts to push the coin up.
Amid XRP’s struggles, Bitcoin has been booming. The world’s most valuable coin is inching closer to all-time highs at spot rates. The recent upswing is driven mainly by the influx of capital through the multiple approved spot Bitcoin exchange-traded funds (ETFs). Besides, there is optimism as the network will slash miner rewards by 50% in April 2024.
Feature image from Canva, chart from TradingView
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Author: Dalmas Ngetich
