Ripple’s XRP is having mixed fortunes at the moment. Therefore, it is not yet clear whether its price will rise or fall in the near future. First, the United States SEC legal action has created much uncertainty towards XRP which has stifled its price performance. However, Ripple’s advanced plan to launch its stablecoin (RLUSD) may provide the coin with a strong base for a price surge.
If Ripple’s RLUSD stablecoin has a positive impact on its price movement its value may surpass $1 or $2 within a few months. The hype around RLUSD increased after Ripple announced at its Swell 2024 conference in Miami that it is ready to launch the stablecoin. No doubt, the stablecoin built on Ripple’s XRP ledger will likely increase the demand for XRP. Basically, RLUSD is a stablecoin backed 1.1 with the United States dollar.
To increase the demand for its stablecoin Ripple has partnered with several cryptocurrency exchanges such as Bitstamp, Bitso, and Uphold. In addition, Keyrock and B2C2 will be the market organizers of the RLUSD stablecoin. These partnerships are earmarked to increase the liquidity and smooth trading for the stablecoin. Similarly, through working with established crypto firms Ripple aims to enhance the credibility and integrity of RLUSD.
Also, to further position RLUSD favorably in the market Ripple has incorporated new members into its team. These include Sheila Bair, former FDIC chair and David Puth, ex-Center CEO. Their knowledge of the sector and regulatory developments will help Ripple to navigate current and future regulatory challenges. It will also enable the project to capitalize on emerging opportunities in the crypto sector.
Of note is the fact that Ripple has not yet set a launch date for the stablecoin. It is still waiting for its approval by the United States government. As soon as it gets the approval to run the cryptocurrency it will launch it on a global scale. Commenting on this development, Simon McLoughlin, Uphold CEO said, “Stablecoins are the killer use case for blockchain technology and help to solve one of the most glaring problems in modern finance – cross-border payments. We expect stablecoins to replace many use cases of traditional fiat money faster than many people imagine as virtually all major financial centers are now enacting clear regulations for stablecoins.”
Effect of RLUSD Launch on XRP Price Trajectory
XRP is known for sharp price fluctuations due to internal or external factors. For example, when the U.S SEC appealed against the recent SEC vs.Ripple court ruling the value of XRP fell significantly. Now, if it responds in a similar manner to the launch of Ripple’s stablecoin its value may rise significantly. In the short run investors anticipate the XRP price to reach $1. Nonetheless, in the long-run it may surpass $2.
At the time of writing, XRP is trading at $0.53 XRP/USDT at Gate.io, after losing value by 1% within the last 24 hours. XRP is within a descending wedge formation on the weekly price chart. As a result, there is a possibility that it may break down or break out above the triangle.
XRP Weekly Price Chart – Coingecko
As seen in the image XRP has formed a wedge formation. Presently, it is showing much bearish momentum. The next graph gives greater details on its possible price move.
XRP Weekly Price Chart – Gate.io (XRP/USDT)
The indications on the image above shows that XRP is experiencing great selling pressure. First, the Ichimoku cloud is orange and sloping downwards. Second, the price has failed to break below the 200 EMA. However, it is slightly below 139 EMA. In this chart the two EMAs form a strong support zone. If the XRP price falls below this price level it may head towards $0.50. If the selling pressure increases it may plunge below $0.496.
The Reasons behind XRP Bearish Outlook
The current XRP trend shows that many whales are selling the coin. Specifically, several Ripple whales have moved many coins to the exchanges. For example, a whale moved more than 20 million coins to Kraken exchange while another transferred 28.3 million to Bitso exchange. The massive XRP sales have created pessimism among the crypto community. This may influence many more investors to dispose of their holdings.
Then, again, the current standoff between Ripple and the United States SEC over the status of XRP is making the situation worse. Thus, the current situation indicates that XRP may only recover if Ripple wins its case against the U.S SEC. The SEC’s last-minute appeal on the recent ruling means that the uncertainty surrounding XRP may continue until 2025. The fact that the case may drag for another year might have dampened some investors’ hopes. In addition, the stability in the XRP open interests shows that the coin may be facing a bleak future. This is because the cryptocurrency is failing to attract new investors. Thus, the current SEC vs. Ripple legal battle as well as the mistrust and uncertainty that exists among XRP investors may increase its market volatility.
