How Ripple’s XRP Is Facing Challenges In Offering Long-Term Value To Its Investors
The price of XRP has been quite stable until recently when despite the massive pumping in the market over the last several days, its value has fallen in comparison to the others.
While the top three currencies of BTC, ETH, and BNB had weekly gains of more than 10%, XRP suffered a weekly loss of more than 5% over the same time.
Things got even more worrisome for short-term players as a consequence of the state of XRP’s on-chain measures. This is due to the MVRV ratio of XRP has not been able to remain stable for a prolonged length of time.
As a result, the MVRV ratio’s ambiguity further emphasises the reality that investors are losing money they have gained.
In contrast, there have been recent increases in XRP’s other price analysis tools such as by the dormant circulation. Increased dormancy is usually showing a continuing overall accumulation trend.
However, since the returns on XRP have been unappealing over the short term, it is reasonable to consider the recent fluctuation of its cryptocurrency price.
To illustrate XRP’s return, it has gained just 6% in a month, while Bitcoin has increased in value by more than 30% during the same time period. Ethereum and Binance Coin have also increased in value by more than 15%.
How Would Things Be Different In The Long Run?
It is generally assumed that trends will change for the better in the long term. However, in the case of XRP, the case may not be the same.
The issue is, although its company, Ripple Labs, offers an open-source payment system, it has too many competitors both on and off the cryptographic trading floor, and it certainly needs to keep up with them.
Before this, we analysed how COTI may ultimately be in the same league as XRP as time goes on.
COTI, a fintech platform that allows users to build their own payment solutions, has already established itself in a variety of sectors, including cross-border remittances, an area in which Ripple has been engaged for many years.
As a consequence, as other competitors in the same industry step up their game, Ripple may no longer be the favoured protocol for cross-border payments in the future, even if today it has already made deals with hundreds of institutions from nearly 50 countries. If this were to happen, XRP’s ranking would fall, and its price would suffer.
However, if such a scenario arises, the popularity and the ‘up-and-down experience’ that Ripple and XRP have accumulated over the years will be sufficient to handle challenges posed by many other types of competition and challenges emerging later.
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