Ripple Coin Investment Analysis
This was a crazy weekend for every Ripple Coin investor: in just 48 hrs the Ripple Coin’s price jump from $0.014 to $0.064 with an increase of 357,14%!
Like you can see in the following pic, the Ripple Coin literally exploited to $0,064 to settle back down to $0.0429.
In these days Ripple’s subreddit, telegram’s chats and groups are full of Ripple enthusiast, but, as we know, feelings are bad for traders. So, let’s try to take a deeper analysis of this price explosion.
It is a common opinion that this is a speculative bubble: is a short period of time ripple will come back to its purgatory of ridiculous prices (>$0.005). Anyway we think a little differently from this cynical view:
- Unlike many others cryptocurrency, Ripple has a real company who works for it. This company plans to replace SWIFT bank protocol with Ripple Protocol, and it started collaborations with several big central banks (like Bank of Japan, Unicredit etc.). This means a lot of attentions on Ripple Coin (the official Coin of the protocol).
- Many investors still don’t understand that, but in case banks decide to start using Ripple protocol, they’ll NOT use Ripple Coin to transfer money. The “bank-to-bank” transactions will be on the same network of Ripple Coin, but using another value token.
- It’s true that Ripple Coin are pre-mined, and there are tons of coin out there (the company plans to ultimately produce 100 Billions of Ripples), anyway there is a constant amount of Ripple that is “burned” as transaction fee. The exact amount of Ripple burned is ~1/1000th of a cent). This is a prevention of transactions spam. In long term, if Ripple will be adopted by some payment companies (ex. PayPal), who will increase the number of Ripple used, it could be a sort of “inflation control”: more people use Ripple, more Ripple get burned like transaction fees. Anyway, the ripple fees are ridiculous compared to Bitcoin’s, and the transactions speed too (in a couple of secs you could move your Ripple from a wallet to another one).
So, is Ripple a good investment?
We can’t give you a certain answer: it has all the point needed to become a used and reliable payment method, anyway, until some mainstream subject (big bank, PayPal, online marketplace etc.) start to accept and promote it, its value will be very unstable. We love Ripple structure (fast and cheap), and we plan to keep on buying Ripples, but unless you truly believe in Ripple future, we suggest you top don’t dedicate to it more that 20-30% of your alt-folio.