Should I Buy Ripple's XRP In 2023? Pros And Cons Of XRP Investment

Last Updated December 20th 2022

12 Min Read

Ripple's XRP, like the rest of the market, seems to be gaining traction after a disappointing 2022.

So, is now an excellent time to buy XRP, or its not out of the woods yet?

Let's take a deeper look at XRP to find out.

XRP Transfers Are Pretty Cheap

The low cost of transferring XRP from one account to another makes it a popular cryptocurrency for transferring value. For context, $10,000 can be transferred with fees as low as $0.0001 using XRP. Compared with other coins such as Bitcoin or Ethereum, XRP is much better for value transfers.

This low cost makes XRP better suited for everyday payments. It also makes XRP a good cryptocurrency to buy and hold for the long haul. As cryptocurrencies become accepted for payments, XRP's low-cost transfers play a positive role in its value.

Do you believe XRP's low transaction costs make it an excellent cryptocurrency to buy today? If yes, here are some of the best exchanges where you can buy XRP.

Binance
Coinbase
eToro

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

XRP Tends To Move In The Direction Of The Broader Market

Although XRP has faced issues since the Ripple case started, this cryptocurrency still trades in the overall market direction. For instance, in the cryptocurrency market bull run that ended in 2021, XRP was going up even though it did not retest the all-time highs that it had made in 2017.

So, why does XRP trading in the direction of the broader market matter? Well, it matters because the cryptocurrency market tends to move in tandem with the Bitcoin halving cycles. Going by past cycles, the next cycle may be starting now and will peak in 2025.

By this logic, it follows that XRP is massively undervalued at current prices now. Besides, by 2025, the odds are that the case between Ripple and the SEC will have ended, clearing off a major hurdle for XRP at the moment.

With the potential to rally off its current prices, XRP comes off as one of the best cryptocurrencies to buy and hold. Even if XRP were just to retest the prices it hit in 2017, it would be a big win for investors.

XRP Is A Decentralized Cryptocurrency

XRP is 100% decentralized and not under the direction of any bank or other centralized authority. It's pretty much like Bitcoin in this respect. This means you can be sure your money won't go anywhere when transferred via XRP. No one can freeze your transaction for whatever reason.

The decentralized nature of XRP makes it a popular cryptocurrency with many people who want to avoid being tied down by traditional currencies. It also makes XRP highly popular with investors.

That's because one of the core reasons for cryptocurrencies to exist in the first place is to decentralize finance. While many centralized cryptocurrencies have come up in recent years, the collapse of a large-cap cryptocurrency (Terra) has reinforced the need to invest in decentralized coins.

This puts XRP at the forefront of cryptocurrencies that investors may find favourable going into the future. For this reason, XRP comes off as undervalued crypto to buy now when overall crypto prices are still way off the 2021 highs.

XRP's Potential Market Is Huge

XRP was created to tackle the inefficiencies of the global banking system. Thanks to its fast transaction speeds and low costs, banks could find XRP a profitable option for cross-border payments going into the future.

This is a big deal when you factor in the size of the global cross-border payments market. It is a market that is worth upwards of a trillion dollars. If XRP takes just a small portion of this market, the impact on its value could be huge.

With Ripple, one of the largest fintech companies globally, connected to XRP, the odds are that XRP could gain long-term traction in the cross-border payments market. The potential for it to trade at multiple times its current price is pretty high.

Don't Miss: Ripple (XRP) Price Prediction

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

XRP Has Proven To Be A Resilient Cryptocurrency

Due to the wild west nature of the cryptocurrency market, many scams have come, rallied for a while, then disappeared with investors' money.

That's why it is best to consider investing in cryptocurrencies that have proven to have an element of resilience. It speaks strongly to their credibility as investments. On this front, XRP stands tall among the best cryptocurrencies in the market since crypto became a thing.

Since 2009, many cryptocurrencies have come and gone. XRP entered the market in 2012 and has maintained its position among the top 10 cryptocurrencies by market capitalization.

However, what speaks best about XRP's resilience is the issues it has gone through since 2020. When the SEC announced that it was going after Ripple for selling XRP as illegal security, XRP lost its number 3 position.

Interestingly, the price stabilized, and XRP has retained its position among the top 10 cryptocurrencies by market capitalization. XRP adoption also continues to grow despite the prolonged legal issues affecting Ripple. This leads to two significant conclusions.

First, despite Ripple's issues, investors still have faith in XRP as a tradable asset and a means of payment. Second, it is an indicator that if the case facing Ripple ends favourably, XRP FOMO could easily kick in and push this cryptocurrency back to its market rank before the SEC case came up.

Whichever way you look at it, with investor confidence in XRP still high, it stands out among the best cryptocurrencies to buy and hold.

XRP Transfers Are Fast

XRP is the fastest way to send money across borders, with transactions taking less than 5 seconds. It's more reliable and easier for people in different countries to exchange their goods & services by using this digital currency compared to traditional banking.

This is a big deal as it gives XRP an edge as a potential replacement for the current system for international payments. So far, XRP adoption is gaining traction due to its fast transaction speeds.

In several Asian countries, banks are already using XRP for cross-border payments. As this use case gains traction, XRP's value will also grow. That's why despite Ripple's legal issues, XRP still stands out as one of the best cryptocurrencies to buy now. The future looks bright for it.

XRP Association With Ripple Is A Good Thing

XRP's association with Ripple may feel like baggage in the short term. However, when you take a broader view of the market, it is one factor that makes XRP a smart cryptocurrency investment in 2023.

To understand why, consider that Ripple is one of the largest blockchain companies in the world. Ripple's tech is so advanced that even as the case with the SEC drags on, banks in places as diverse as The Middle East and Japan are still adopting its tech. For instance, Ripple's technology called XCurrent is used by dozens of banks globally for cross-border payment settlements.

If by any chance, the case ends in Ripple's favour, there is a chance that the adoption of Ripple's cross-border technologies could rocket. One of the technologies that could boost XRP value is xRapid. This is Ripple's cross-border payments solution that settles transactions in XRP.

It is also noteworthy that before the case started, Ripple had won several valuable partnerships in the U.S, including with MoneyGram. If the case ends well, many of these partnerships could return. The result would be a surge in the use value of XRP and could see emerge as one of the best-performing cryptocurrencies in coming years.

With Ripple constantly scoring wins against the SEC, there is a chance that things could end in its favour.

For this reason, XRP is an undervalued cryptocurrency to buy and hold over the next few years. All investments carry risk, but XRP seems like a potentially high-risk, high-return play when considering these factors.

XRP Is Easily Accessible On Most Major Exchanges

Where a cryptocurrency is listed has a bearing on its potential value appreciation. When a cryptocurrency is easily accessible on major exchanges, new investors can easily buy into it and support the price.

Besides, there is a tendency that most low-quality cryptocurrencies and scams are usually listed on small exchanges.

Many investors now know this, as an advantage for cryptocurrencies like XRP. Despite some exchanges delisting it following the SEC case against Ripple, XRP is still listed on most major cryptocurrency exchanges. This gives it strong liquidity. Things could get even better if the case against Ripple comes to a favorable conclusion.

It would see even more exchanges list XRP, and those that had delisted it, possibly relist it. This high liquidity, coupled with XRP's strong use case, makes it one of the best cryptocurrencies to buy now when prices are still at their lowest.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Drawbacks To Investing In XRP

All cryptocurrencies are high-risk investments, and XRP is not an exception to the rule. In fact, when you consider that XRP is linked to Ripple, a company battling a court case with the SEC, the risks magnify.

To help you make an informed decision when investing in XRP, below are some key risk factors you need to consider.

The SEC Case Against Ripple Could Hurt XRP

When the SEC first announced that it was going after Ripple, XRP took a big hit. That was when XRP lost its number three position in the market cap rankings for the first time in many years.

It is also noteworthy that XRP has underperformed Bitcoin and many other top cryptocurrencies for the period the case has been ongoing. This is an indicator that investors are still cautious about investing in XRP.

Therefore, if the SEC wins the case against Ripple, the price of XRP could tank. There is a real risk that XRP could fall off the top 10 in market cap rankings.

If recent events, especially around Terra are anything to go by, investors are aware that even top-ranking cryptocurrencies can go to nothing instantly. All it takes is a confluence of negative factors. For XRP, the risk factors would be compounded by the SEC winning the case when the broader cryptocurrency market is bearish.

Ripple Owns The Majority Of XRP

Unlike Bitcoin, which many diverse groups of people own, Ripple owns most of the XRP in the market. This means there is a risk of them dumping it and hurting retail investors in the process. From an investor perspective, it means you are placing your hopes on Ripple. You don't have to worry about that risk when investing in something like Bitcoin or Ethereum.

Is XRP A Good Cryptocurrency Investment Today?

If you have read through this guide, then you are in a position to decide on whether XRP is a good cryptocurrency investment.

That said, besides considering XRP's core fundamentals, you need to be aware of the buying process's risks.

To be on the safe side, read on the other essential factors you need to consider when you want to buy XRP.

Here are some of them.

Only buy XRP from credible cryptocurrency brokers.
Once you open an account and buy XRP, set a password that can't easily be cracked. A lot of people lose their cryptocurrencies to scammers due to weak passwords.
After you have bought XRP, move it out of the exchange and to a secure wallet. That's because there is always a risk that the exchange can close shop with your cryptocurrencies inside. It can also get hacked, and you end up losing all your assets.
Since all cryptocurrencies carry risks, and XRP can underperform, invest in several other cryptocurrencies.

Confident about XRP's fundamentals and how to navigate the exchanges landscape? Let's now look at how to buy XRP.

Where To Buy XRP

Through in-depth analysis of the market, we have compiled a list of the best exchanges where to buy XRP.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

XRP Vs XLM – Which Is A Better Cryptocurrency Investment?

Going by their fundamentals, XRP and XLM are among the best cryptocurrencies to buy in 2023. Both have proven to be resilient, and adoption is on the rise.

Therefore, to increase your odds of success, it would be best to invest in the two of them. You increase your odds of success compared to only betting on one of them.

If you don't want to buy both, Stellar (XLM) is a much better bet in an either-or situation. Here's why.

For starters, Stellar has much lower regulatory risks than XRP. At the moment, Ripple is fighting it out in court with the SEC over whether XRP is a security or not. If the court rules that XRP is a security, it could have many negative implications for XRP.

On its part, XLM does not and has never had this risk. That's because, unlike XRP, which is linked to a company, XLM was started by a non-profit foundation. Since these two cryptocurrencies have similar use cases, the lower risk of XLM could drive investors towards it and eat into XRP's market share. This gives XLM a much higher potential for growth and by extension, comes off as a smart cryptocurrency investment to make today.

Secondly, Stellar is less focused on a single market, reducing its risk of failure. Since it was formed, XRP has largely been marketed as a solution to the banking system, more specifically in cross-border payments. On its part, XLM can cater to this market but is also marketed as a cryptocurrency for the unbanked populations of the world.

The issue here is that SWIFT dominates the cross-border payments market that XRP is focused on. Besides issues to do with efficiency, SWIFT has geopolitical connections to it. This could make it hard for XRP to gain real traction, a factor that could stifle its growth. On its part, XLM's value proposition of banking the unbanked is much more achievable. There are billions of people in this world who own a smartphone but are not included in the banking system in a meaningful way.

In essence, when you consider the ease of market access for these two cryptocurrencies, XLM easily comes off as one of the best cryptocurrencies to buy now.

That said, a savvy investor would be looking to buy XRP, XLM, and a host of other cryptocurrencies. The goal is to ensure that you are not overly exposed to any single cryptocurrency.

Conclusion – Is XRP A Good Cryptocurrency To Buy Now?

Going by its use cases and potential for adoption, XRP is a promising cryptocurrency to buy now.

XRP's technical capabilities are sound, and adoption continues to grow even as the case between Ripple and the SEC drags on. It's an indicator that the market has faith in XRP's capabilities.

Now that you know that XRP is a good cryptocurrency investment, how do you buy it? As mentioned earlier, there are many cryptocurrency exchanges where you can buy XRP. One of the best among them is eToro.

To buy XRP through eToro, follow the steps below:

Go to the eToro homepage and click signup. You will be prompted to fill out a form that will only take a few minutes of your time.
After you have signed up, eToro will do KYC on you by asking for your identification documents. Upload them, and wait for them to be verified.
Once the verification is done, you can deposit money into your eToro account. There are multiple deposit options, from bank transfer cards to online wallets like PayPal. You can deposit anything as low as $50.
After the deposit lands in your account, go ahead and buy XRP. eToro allows crypto purchases starting as low as $10.