The Rise of XRP: Key Factors Behind Its Surge
Since the U.S. presidential election on November 5, 2024, cryptocurrencies led by Bitcoin have surged, with Ripple's XRP standing out. On December 2, XRP surpassed Solana and Tether (USDT) to become the third-largest cryptocurrency by market cap, returning to pre-2020 SEC lawsuit levels.
1. Development History
Ripple traces its origins to 2004, when Ryan Fugger created RipplePay, a peer-to-peer payment platform. In 2012, Jed McCaleb and Chris Larsen transformed it into OpenCoin, launching the RippleNet protocol and XRP token. By 2015, OpenCoin rebranded as Ripple Labs, focusing on bank partnerships.
Key milestones:
- 2013–2014: Early adoption by banks like Santander.
- 2017: XRP peaked at $3 during the crypto bull run.
- 2020: SEC lawsuit alleging XRP was an unregistered security.
- 2024: Price stabilized at $0.70–$1.00 before recent rally.
2. Drivers of XRP's Current Rally
a) Ripple vs. SEC Legal Breakthrough
- Former CFTC Chair Chris Giancarlo predicts SEC may drop the case under a crypto-friendly administration.
- A Trump-appointed SEC chair could shift regulatory policies, benefiting XRP.
b) Pro-Crypto Trump Administration
- Trump pledged to make the U.S. a "crypto hub" and proposed eliminating capital gains taxes for crypto.
- Regulatory clarity could boost institutional adoption.
c) Ripple's Technological Edge
- XRP Ledger: Processes transactions in seconds via RPCA consensus.
- Partnerships: 100+ banks use RippleNet for cross-border payments.
- ETF Applications: Bitwise and 21Shares filed for XRP ETFs.
- Stablecoin Plans: NYDFS may approve Ripple’s RLUSD.
3. Risks to Consider
a) Centralization Concerns
- Ripple Labs controls ~50% of XRP supply.
- Heavy reliance on Ripple’s governance raises decentralization debates.
b) Leverage-Driven Volatility
- Record-high derivatives open interest signals potential market corrections.
c) Misconceptions
- RippleNet ≠ XRP: Banks adopt the protocol, not necessarily the token.
FAQs
Q1: Is XRP a good investment in 2024?
A: While regulatory tailwinds and tech adoption are bullish, monitor SEC case outcomes and market leverage risks.
Q2: How does XRP differ from Bitcoin?
A: XRP focuses on fast, low-cost payments via centralized validators, unlike Bitcoin’s decentralized PoW model.
Q3: Will XRP ETFs be approved?
A: Proposals are pending, but approval hinges on SEC’s stance under new leadership.
Q4: What’s Ripple’s RLUSD stablecoin?
A: A potential NYDFS-approved stablecoin to expand Ripple’s payment solutions.
👉 Explore XRP’s latest price trends
👉 Ripple’s official partnerships
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