Ripple (XRP) is the third most valuable digital currency in the world, but it has failed to bring excitement to the table. The digital currency has an issue, its token has lost over 80 percent of its value since its all-time high in December last year.
But that is not the major problem, as the digital currency is facing some action lawsuits. Another significant issued faced by the digital currency is the perception that the “bankers’ coin” is not cool.
The qualities that attract institutional funds to Ripple – speed, banker-friendly approach, and efficiency – also set it far away from the rest of the crypto verse. The multi-million dollar valuation of Ripple depends on it’s digital currency – XRP.
The Promise of Ripple
Making cross-border payments usually take a lot of time and they cost a fortune. It goes through rigorous processes that take up to several days to complete. According to the World Bank, Indians working abroad send home about $65 billion every year. This is a huge remittance market.
This is one of the prime target markets of Ripple, and a lot of people are excited about the fact that the Ripple project is aimed at solving this problem – to provide cheap and quick cross-border payment services.
Ripple and XRP
Although holders consider themselves investors, a lot of digital currencies don’t come with benefits of a real financial contract. Instead of dividends or equity, you get tokens which you hope will be valuable one day.
XRP is not even the major token used in the networks of Ripple. XRP powers only xRapid, but not xCurrent and xVia – the major settlement ledger for international markets and banks. It is just like Ripple Labs were raising funds for their new subway line by selling tickets in advance –except the tickets they are selling are bus tickets.
This is why the digital currency is in so much trouble, not only with regulatory bodies but also with its investors, and this is one of the reasons why the coin is still considered a security.