25th Nov 2020

Ripple Outlook: What 2021 May Hold for This Cryptocurrency

Article Table of Contents:

Ripple Performance Until Now

With a total market capitalisation of $10.5 billion, as of November 19, 2020, Ripple is the fourth largest cryptocurrency by market cap. Not many cryptos have experienced as much success as Ripple has, over the years. Not only does it have robust technology backing it, it also has the potential to solve many real-world issues.

What makes Ripple special is that unlike other cryptos, such as Bitcoin and Ethereum, it isn’t completely decentralised. Unlike other cryptos also, it doesn’t aim to provide traders and investors a decentralised way to conduct transactions. Instead, it wants to make it easier for centralised entities to make transactions.

Cross border payments, in particular, can be quite slow and have incredibly high transaction fees when done the traditional way. But by using the Ripple ecosystem, organisations can receive and send payments via its native currency, XRP. This creates a globalised currency that can bypass some of the issues that affect completely decentralised cryptos as well as fiat currencies.

Ripple has been performing quite well in recent years. But losing the spot as the third largest crypto earlier in 2020 made some people unsure about its outlook in 2021. So, what does 2021 hold for this cryptocurrency?

Ripple Performance Until Now

The First Peak

To make forecasts regarding the performance for Ripple in 2021, let’s take a look at how it has been performing up until now. At the start, the price of XRP was around $0.0058. The token hovered around this price for years after its launch. The coin experienced its first major jump in March-April 2017, when it rose to a value of $0.03. This growth continued in May, with the coin soaring to $0.20. This increase in value is attributed to the Bank of Tokyo-Mitsubishi joining the Ripple network. The Bank of Tokyo is the world’s third largest bank.

For most of the remainder of 2017, the price of the Ripple coin stayed between $0.18 and $0.30. By the end of the year, XRP started to rally again. Bitcoin and other cryptocurrencies were experiencing a massive boost during this period. This had a positive impact on Ripple as well. As a result, the value of XRP hit $1 in December 2017 and reached almost $3 in January 2018.

A Slow Decline

But this did not last long. Most cryptos were declining in the early part of 2018, imitating Bitcoin’s trajectory. Ripple was no exception, plummeting to $0.07 by February. In September 2018, Ripple announced the release of Rapid, a forum for payment services and financial institutions. This announcement caused the coin to climb again. But after this, the price has been on a continuous decline.

The Outlook for 2021

In the middle of 2020, XRP had a bearish dip of $0.22. But it has regained its position value from that point. The coin is trading above the Arnaud Legoux Moving Averages (ALMA), a bullish indicator. Additionally, the moving average convergence/divergence (MACD) is also over the signal line. These all point towards Ripple being bullish for the remainder of 2020 and into 2021.

There are some other factors which point towards growth in the value of XRP. According to recent research by Moody’s, blockchain standards are expected to increase in 2021. This could prove positive for Ripple, as it is looking towards lots of advancements in 2021.

Additionally, Ripple’s partner, Flare Network, recently announced that they are planning to create a 2-way trustless bridge with Ethereum. With this, Ethereum-based applications would be able to access the XRP ledger and vice versa. By integrating Ripple with Ethereum’s smart contracts, Flare Network would be able to improve the functionality of the crypto. This is expected to lead to greater demand and, therefore, higher price.

So, how high is the price expected to reach in 2021? Ripple has maintained an uptrend since the first quarter of 2020. Between the dip of March 2019 and October of 2020, the digital currency has grown 136.04%. If the coin maintains this trajectory, it could reach between $1 and $1.50 in 2021.

Cryptocurrencies are extremely volatile, and these are just predictions, not certainties. So, before you decide to open a position, do thorough research and put appropriate risk management measures in place.
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