Ripple is not like other cryptocurrencies in any way. Instead, it provides something unique in comparison to any other form of digital currency. Ripple is an entirely new sort of payment system that aims to streamline international and cross-border payments all over the world. This is in contrast to cryptocurrencies such as Bitcoin and Litecoin.
Even though this gives a good opportunity for financial speculation, you need to have a strong understanding of what Ripple is, what it accomplishes, and any potential warning signs that you should be on the lookout for. In the end, no investment is foolproof.
Here are some of the benefits and drawbacks of investing in Ripple so that you can make a more educated choice about the next step you take in the market if you ever wanted to buy XRP, Ripple’s coin, and test the cryptocurrency market.
The fact that many cryptocurrency analysts and speculators believe Ripple has a bright future makes it a desirable choice for both new and seasoned traders. Here are some quick reasons why XRP is a wise investment.
1. XRP Has A Relatively Low Price
Compared to its prior high in 2018, Ripple is inexpensive. A significant number of Ripple coins can be purchased for less than a few hundred dollars, and even a modest bet of $50 would yield more than 65 coins. Although Ripple reached a record high of more than $3.10 in 2018, some market analysts predict it may surpass the $1,000 mark over the next ten years. Other forecasts are far more upbeat.
So, purchasing some Ripple is a relatively low-risk alternative with the potential for a significant return on investment given its low price and growing mainstream appeal.
2. Ripple Finds Solutions
Ripple helps huge financial institutions with their difficulties. Additionally, it accelerates capital flow, which is great for the economy. But small business owners might also use Ripple. The Ripple platform will give millions of independent business owners and single proprietors access to the global economy if it is broadly embraced.
3. Ripple Market Cap
Ripple is now ranked as the eighth-largest cryptocurrency in the world with a market worth of about $35 billion. An asset that has a substantial market value is more resilient to choppy market cycles or dips and is a clear indication of investor confidence.
4. XRP Is Different From Other Cryptocurrencies
Ripple is a legitimate business, not just a coin or piece of technology. Over 500 people work for Ripple Labs Inc. full-time, including public relations and marketing specialists who sell the technology to financial institutions, investors, potential customers, and the general public.
5. Investors and Partnerships
Out of all the cryptocurrencies, Ripple has arguably the strongest support from financial institutions. It is even more popular than Bitcoin in some quarters.
According to Pete Rizzo, their first significant banking partner to utilize the Ripple Payment Protocol was the German bank Fidor in May 2014, along with American Express, Santander, and MoneyGram which have become some of their largest partners today.
Ripple investing comes with some risks, just like any other investment. So, here is what you need to know about the dangers of XRP investment.
1. There Won’t Be Any New Ripple Created
Given that even if there is an infinite supply of Ethereum, production will eventually slow down. Due to the restricted supply, demand may rise in the future, driving up prices and boosting returns for early investors. Ripple is unique. All of the XRP coins have already been produced and are in use.
2. Ripple Labs Inc. Holds A Significant Amount Of XRP
A third of all XRP is owned by Chris Larsen, the chairman of Ripple. Brad Garlinghouse, the CEO of Ripple, and other senior board members also own a sizable amount. There is a potential that the price is exaggerated because there are so few people holding the majority of the XRP.
3. There Is No Decentralization
XRP isn’t a “genuine” cryptocurrency in the eyes of blockchain purists. Ripple was specifically created for the finance and banking sector, in contrast to Bitcoin, which is mined and subsequently anonymously traded between individuals.
When it comes to investments, the question of risk versus reward always comes up. In other words, do the probable benefits of taking the risks exceed the potential negative outcomes of doing so?
There are undeniably certain dangers associated with using Ripple. On the other hand, Ripple is gradually making its way into the mainstream and has the support of some of the world’s most important financial institutions.
Ripple (XRP) is an investment that carries a minimal level of risk but could potentially yield a great deal of profit. Before you even think about including it in your portfolio, you need to give this topic a lot of thought and conduct a lot of studies.