- VirtualBacon, once a critic of XRP, now predicts it to be a top performer in the impending bull run.
- Three critical reasons, including Ripple’s escrow system and rising demand with CBDC advancements, make XRP a standout.
XRP’s Resurgence: From Contempt to Contender
Longtime crypto analyst and educator VirtualBacon has shifted his stance on Ripple’s XRP. Once critical of XRP for its perceived centralization and price behavior, VirtualBacon now anticipates XRP to eclipse many of its major counterparts in the forthcoming crypto bull market.
Reasons Behind the Predicted XRP Ascendancy
Firstly, VirtualBacon notes that XRP hadn’t revisited its all-time high for half a decade, undergoing two price suppression cycles. For the uninitiated, this implies that while other major cryptocurrencies have reached or surpassed previous peaks, XRP still has a lot of ground to cover, indicating potential for significant gains.
The second point is tied to XRP’s ‘tokenomics’. Over the past three years, 70-80% of XRP has been securely locked back in escrow, dispelling fears of a massive dump by Ripple. To provide clarity, an escrow in the crypto world serves as a contractual agreement where the tokens are held by a third party and are released once certain conditions are met.
Back in 2017, Ripple launched this escrow system by locking 55 billion XRP tokens (roughly 55% of its total supply). Divided into separate escrows containing 1 billion XRP each, these tokens are released monthly. This approach ensures controlled supply, maintaining stability in the ecosystem, and addressing the demands of holders, all the while bolstering XRP’s growth trajectory.
The last point underscored by VirtualBacon is the burgeoning demand for XRP, which he believes is in tandem with the progressive growth of central bank digital currencies (CBDCs) and systems like FedNow. For clarity, the FedNow Service isn’t a currency but a payment system offered by the Federal Reserve to aid financial institutions in fund transfers for their clientele. And while it doesn’t act as a substitute for traditional payment methods, its evolution is seen as beneficial for digital currencies like XRP.
Further buoying XRP’s prospects is the amplified investment focus on XRP-associated assets, which witnessed a 127% uptick this year, accounting for a significant 12% of assets under management (AuM). Coupled with a recent favorable verdict against Ripple Labs by the Securities and Exchange Commission (SEC) – which differentiated XRP from conventional securities – the investor interest has spiked. However, it’s worth noting that while this ruling prompted several major exchanges to relist XRP, thereby enhancing liquidity, the SEC’s intent to challenge the decision on XRP sales could introduce fresh challenges.
