The price of XRP has fallen this year, as have the price of many other cryptocurrencies. The large-cap coin is down 52.3% year-to-date, reflecting the broader decline in the cryptocurrency market, which is unsurprising given its positioning.
Despite its decline, XRP remains an attractive investment option for investors. Towards the end of the year, it is hoped again that the value of the coin will increase. This article will share three reasons for this hope.
Ripple’s XRP token has become the de facto standard for cross-border payments, providing a key use case for investors looking to make money and users who need crypto-specific functionality.
The SEC case could be coming to an end
The case between XRP developer, California-based Ripple Labs, and the Securities and Exchange Commission (SEC) has been a major sticking point over the past year and a half.
In December 2020, the Securities and Exchange Commission sued Ripple, accusing the company of violating securities laws when it offered XRP to investors in its initial coin offering (ICO).
The case had a significant impact on XRP, including delisting the asset from several cryptocurrency exchanges. However, this could have far-reaching implications for the market as it could pave the way for the SEC to classify digital assets as securities in the future.
Meanwhile, last week there was renewed optimism that Ripple would win this lawsuit. Both parties filed separate motions in the United States District Court for the Southern District of New York for summary judgment.
These judgments are requested when a party believes there is enough evidence to make a decision without a trial. Additionally, Ripple management claimed that the SEC did not provide a basis to classify XRP as a security.
It’s unclear if the SEC case will be resolved anytime soon. Still, XRP investors are optimistic.
CFTC visit raises prospect of favorable rating
While Ripple Labs is battling the SEC for the best classification for XRP, the company appears to be in advanced discussions with another financial regulator.
Commodity Futures Trading Commission (CFTC) Commissioner Caroline Pham confirmed earlier this week that she met with Ripple Labs CEO Brad Garlinghouse as part of her “learning tour” on cryptocurrency. change. The visit raised hopes that XRP could be classified as a commodity rather than a security, as the SEC would like.
Proponents of cryptocurrencies have repeatedly argued that the CFTC should regulate them. Pham’s visit to Ripple and his interaction with Garlinghouse therefore raises questions about what cryptocurrency holders think and where law enforcement and regulators stand.
Focus on energy consumption
For more than a year, the crypto market has been criticized for its role in climate change. Tesla has stopped accepting bitcoin as payment, and several lawmakers have expressed contempt for digital assets and their overconsumption of resources.
However, Ripple wants to change the narrative. Earlier this week, Ripple Labs announced that it has signed the Climate Pledge, joining over 375 other companies committed to an energy-efficient future.
The market is likely to remain driven by energy consumption. Ethereum recently completed its Proof-of-Stake (PoS) transition, which is expected to reduce global carbon emissions by up to 0.2%. Ripple is spearheading this battle to stay ahead of the curve forever.
Update – XRP also holds its value despite crypto price drop after FOMC – XRP outperforms Bitcoin and Ethereum on a larger scale.