Want To Invest In Ripple? Here’s What You Need to Know
Everything you need to know before you decide to invest in Ripple, including how to buy XRP tokens
On December 29th, 2017, Ripple XRP enjoyed a brief moment as the second-largest cryptocurrency in the world with a market cap of about $73 billion. Although XRP market cap has since dropped, it remains the world six-largest cryptocurrency.
The coin's price has seen a lot of fluctuation over the years, with some experts saying that it might hit new targets this year. In this guide, we will take you through how to invest in Ripple XRP and enjoy the highest Return on Investment (ROI).
However, before we go into the details of how to invest in Ripple, let's quickly go through an overview of what exactly Ripple is.
What is Ripple? Everything you Need to Know About XRP
While people usually use the terms Ripple and XRP interchangeably, they are actually quite different. In a nutshell, XRP is the cryptocurrency, while Ripple is the company that created XRP. However, you will mostly find that people refer to the cryptocurrency as Ripple. In fact, some people who are still young in the crypto market don't even realise the term XRP exists.
So, for the sake of keeping things simple, we might use the term Ripple to refer to the cryptocurrency from time to time.
One of the reasons why XRP is so interesting is because it conforms to a slightly different mode of operation than a standard cryptocurrency. In other words, it acts more like fiat currency, only that it is entirely digital. For one, the cryptocurrency is centralised and not decentralised like most of the other coins. This is because the coin was created by a private company to make profits.
Ripple, which holds most of the XRP available, wanted to develop a seamless way to send money globally. In other words, it is not just a cryptocurrency like Bitcoin or Litecoin. It is a payment protocol on a mission to modernise and streamline payments around the world.
XRP does not use distributed blockchain ledger technology as the other cryptocurrencies. Instead, it uses a common ledger that multiple people can access. The coin is not decentralised and is only controlled and developed by the company, Ripple Labs. It is much faster and claims to offer better security than the other open-source cryptocurrencies.
Merely a year after releasing XRP, researchers at MIT University named Ripple Labs one of the 50 Smartest New Companies. Some financial analysts and crypto optimists believe that Ripple could potentially replace SWIFT as a secure, reliable and standardised cross-border payment network.
As a result, most companies have adopted it, and it is continually attracting the attention of investors who want to tap into its success. In fact, the cryptocurrency is now backed by major investment firms such as the CME Group, Accenture, Google Ventures, Pantera Capital, IDG Capital Partners and Andreessen Horowitz.
This has enabled Ripple to grow significantly, and close partnership deals with renowned financial institutions. These include the Bank of America, UBS, Union Credit, Yes Bank, NBAD and MoneyGram
Ripple Price History
Launched in 2012, Ripple has seen its price grow from a miserable low to become the third-largest cryptocurrency. In 2013, XRP was selling for as low as $0.005 per token. The price began to steadily rise in late 2014, and by early 2015, it hit $0.02.
From there, the price kept fluctuating until 2018, when it attained the all-time high of $3.84 on January 4th. At this time, XRP began to get the attention of crypto enthusiasts and got some media coverage that helped put it in the limelight.
However, in 2019 and 2020, the price plummeted again and was selling below the $1 mark. XRP started 2021 below $1 but then jumped to $1.8 in April. Currently is trading at around $1.1. Experts attribute XRP's price fluctuation to the fact that the original developers and other shareholders sell their holdings to the market regularly. This has left many investors wondering if XRP is still worth investing in and whether the price will rise again.
To answer that, let's look at some of the price predictions, then later look at whether the coin is still worth investing in.
Ripple Price Predictions in 2021- Will the Value of XRP Rise?
Like most cryptocurrencies, XRP is highly volatile. In fact, based on its price history, we can say that it is more volatile than both Bitcoin and Ethereum. So, predicting its price is a huge gamble, and that is why there is a very wide disparity in the various predictions.
For instance, while some speculators think XRP might hit the $500 someday, others believe it will stabilise below the $1 mark for a long time. In the meantime, most experts believe that for the short term, Ripple might now be nurturing an uptrend to the $2 mark.
Given that the volatility Ripple has experienced in the past spreads across the board in the cryptocurrency market, there are hopes that its price might look up just like Bitcoin and ETH. Already, there is a plausible improvement by the end of the year, an indication that we might be looking at a higher valuation in the coming days.
Will Meade, a billionaire hedge fund manager, and former project manager at Goldman Sachs, predicts that XRP will increase someday to attain its previous $3 price.
Likewise, Michael Arrington, a legendary tech investor and Founder of the famous TechCrunch, believes that XRP is set for a bright future since it is “... a really, really good way to move money.”
Other experts such as Financial service advisor Sean Matthew believe that XRP might be going back to its glory days in 2017 and 2018 when it surged above the $3 mark.
To better understand these Ripple price predictions, let's look at its technical and fundamental and Sentiment analysis.
XRP Technical Analysis
This technical analysis helps us evaluate the investment opportunity in Ripple by analysing its statistical trends and price history. Looking at various price charts on different Ripple exchanges, it is undeniable that early Ripple investors might be set for a high ROI if the current trend holds.
For instance, if we consider data from CoinDesk, we can see that Ripple grew by over 30,000% from 2016 to 2018. If that trajectory were to repeat itself in the next two years, we can easily see Ripple's price jumping above the $60 mark.
On the other hand, experts working with the more realistic Fibonacci ratios predict between $4 to $10 per token in the next few years. From these, we can see that Ripple is likely to see an uptrend after more than three years of experiencing a bear market.
If these predictions come to pass, it would mean a huge opportunity for current investors to shine and expand their portfolios even more.
Read More: Is Ripple Worth Buying 2021?
XRP Fundamental Analysis
Unlike the technical analysis, which predicts prices using historical market data, fundamental analysis looks at how macroeconomic factors (like current adoption rate) and microeconomic factors (like company management) can affect the value of Ripple in future.
Unlike other cryptocurrencies, Ripple created a solution that is directly applicable to the payments industry. This pits it against established financial institutions like Swift, MoneyGram and Western Union. So, if Ripple were to replace these institutions (as it currently plans to), its market cap would surge to an estimated $2.4 trillion by 2027.
This would then raise Ripple’s price to about $50 per token based on the current supply of 46.8 billion XRP. Given Ripple’s current momentum and the fact that it has partnered with various banking institutions, we see that while it is difficult, the company may succeed in becoming the number one payment infrastructure.
This would, in turn, mean outlandish ROI for its investors, developers and executives. Also, the fact that Ripple is a centralised private company means better management and less risk compared to decentralised coins.
How to Invest in Ripple
Now, if you believe that Ripple will make for a profitable addition to your investment portfolio, we are going to show you exactly how to invest in it.
There are three methods you can invest in Ripple:
- Buy and hold XRP
- Invest in startups and companies
- Trade Ripple for the short-term
Method 1: Buy and Hold XRP
This is the most popular and simplest method of investing in Ripple. All you have to do is buy XRP and hold it in your online or offline wallet, then sell later when the prices go up.
For instance, if you invest $50 right now, you can get around 45 tokens of XPR. Next, you store these tokens in your wallet then wait until the price goes up. Let's say in three years, the price will be $10 per token. That means, if you sell your tokens then, you will have about $400 in profit that you didn’t even work for.
Now, imagine you buy XRP worth $1000 or more? How much will it be worth in three years? While future prices can only be speculative, it is possible that the more you buy now, the more profits you will enjoy later.
Of course, this is a long-term investment, and you should only do it if you are not in a hurry to make money. The best you can do is buy and forget about it until the right price comes along.
How to Buy Ripple
Buying Ripple is not as straightforward as buying other cryptocurrencies. You can buy it using fiat currencies like the USD or other cryptocurrencies like Bitcoin.
There are several exchanges from where you can buy the coin. Our personal favourites are eToro and Coinbase. After buying, you can store their coins online or offline in a cold wallet.
Method 2: Invest in Startups and Companies
This method is not as popular as buying and selling XRP. We recommend it if you are a more seasoned investor and understand the market well.
In this case, instead of simply buying and holding XRP, you invest in companies or startups based on Ripple or other cryptocurrencies. This kind of investment might be a bit complicated with Ripple since it is centralised crypto and mostly controlled by the developers.
So, the best way to go about this is to invest in promising companies dealing in other cryptos such as Bitcoin then use your profits to buy and store Ripple like in method one.
Method 3: Trade for the Short-term
Unlike buying and storing for the long term, trading is a short-term investment strategy. To trade, simply buy Ripple and sell it as soon as the price goes up, then buy again when the price drops. All these can be done within hours instead of waiting for years for the price to go up.
So, in this case, you will simply be taking advantage of live price movements to make small profits. You stand to make much more, and the risk of capital loss is minimised since you will be frequently selling instead of holding.
However, trading requires skills and is time-consuming since you spend most of your time monitoring price movements.
Ready to invest in Ripple XRP?
Why Should You Invest in Ripple?
Having looked at the history of the coin, current standings, and future predictions, it is clear that XRP might be a good investment, especially for new investors.
The coin has risen from a saddening low price to almost $4 and is expected to have a comeback soon.
Below are 5 reasons why Ripple is a good investment.
1. It’s affordable
Unlike Bitcoin and Ethereum, Ripple is very cheap. This means that you can buy a significant number of tokens for a few hundred dollars. With some market analysts predicting that Ripple might jump beyond the $30 mark in the next 10 years, this could mean a big return on investment with relatively low risks.
2. It has a large market cap
Being the six-largest cryptocurrency in the world, Ripple currently has a market cap of about $51 billion. This is a strong indication of investor confidence and the fact that Ripple is set for a price uptrend in the next few years.
3. It solves real problems for businesses
Being an ingenious payment network, Ripple solves real problems for financial institutions and small businesses. As more enterprises embrace its technology, Ripple will become widely adopted, making it a lucrative venture for its early investors.
4. It is super-fast compared to Bitcoin:
Transacting with Ripple takes only a few seconds compared to Bitcoin, which might take up to 15 minutes to complete a transaction.
5. It's backed by big financial institutions:
As we have already mentioned, Ripple has partnered with some of the biggest players in the financial market. This not only increases its credibility but also its value, which means higher ROI for investors.
Is It Too Late to Invest in Ripple?
Most wannabe Ripple investors are still on the fence as to whether they should invest. On the other hand, some think that it’s too late to start investing. While digital coins such as Bitcoin have been around long enough to disrupt the financial sector, the cryptocurrency market, in general, is still young.
This means that it is not too late to invest in any cryptocurrency, including Ripple. Diving all the way in is not a good idea either. Fear of missing out (FOMO) is very real in the crypto market, and many people have lost their money this way. So, while we advise that you start investing as soon as you can, you should first do your research, understand the market then decide for yourself if you are ready to start investing.
As long as you believe that blockchain technology has a place in the financial market, it is never too late to invest in Ripple. Remember that the cryptocurrency market is highly volatile, and you can lose your money as quickly as you can double it. Never invest more than you are willing to lose, and never make hasty investment decisions.
Read Also: Ripple Price Prediction
Conclusion: So, Should I Invest in Ripple?
Like with most investments, investing in Ripple is all about the risk vs reward factor. Before investing, you need to consider whether potential rewards are more than associated risks or vice versa. It is undeniable that Ripple, like most cryptocurrencies, has some risk factors.
For instance, its founders still hold a huge amount of the coins, it is not decentralised, there won't be any new Ripple in the market, and it can only be mined by its developers.
However, given the backing from investors and big financial institutions, Ripple might see bigger mainstream adoption compared to other cryptocurrencies. This means a lucrative opportunity for early investors to enjoy big returns on investment.
Ripple is a low-risk investment that promises plausible rewards. However, you should do some research then decide for yourself if Ripple is worth adding to your portfolio.
So, if you buy while the price is still low, you might have a rare opportunity to diversify your investment portfolio without exposing your other assets to significant risks.
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