For most of this year, the price for Ripple’s XRP has trended downward. Towards the end of 2018’s first week, XRP price reached a high of $3.54 and a market cap of $137 billion. But its price cratered soon after in the swoon that enveloped cryptocurrency markets as media reports and crypto experts questioned XRP’s utility within the Ripple ecosystem.
Until last week, XRP’s price was languishing at $0.28 per pop and had a market cap of $11 billion. Over the weekend, however, the price for XRP achieved a breakthrough of sorts, more than doubling in less than 24 hours to $0.67. Ripple’s market cap also jumped up to $26.9 billion. The sudden jump even made Ripple the second-most valuable cryptocurrency briefly.
A Case Of Rising Liquidity And Valuation
A couple of reasons have been put forward to explain investor enthusiasm for Ripple. The first one is the launch of xRapid, its payment settlement platform targeted at multinational banks, within “the next month or so”. “I am very confident that in the next one month or so you will see some good news coming in where we launch the product live in production,” Sagar Sarbhai, the company’s head of regulatory relations for Asia and the Middle East, told CNBC.
A successful launch could boost liquidity and traction for XRP, Ripple’s native token. Banks and financial institutions using xRapid have the option of using XRP, instead of fiat currencies, to speed up and streamline transfers across geographies. Thus, instead of maintaining accounts in local currencies at the origination and endpoint of their transactions, they can purchase XRP to facilitate the transfer. Ripple claims that xRapid results in cost savings of between 40 percent to 70 percent and cuts down the time taken for transfers from 2-3 business days to 2-3 minutes.
The second reason for an increase in Ripple’s price is the launch of a trial for Coil, a tipping service for content creators on some of the world’s largest online platforms. The trial service allows users to subscribe to content creator channels or sites for an ad-free and enhanced experience that includes access to content not available to others. According to reports, Ripple’s XRP will be used for tipping. Coil was started by Ripple’s former CTO, Stefan Thomas, and counts Ripple founder Chris Larsen and Evan Schwartz, an engineer from Ripple, as board members. Youtube, Wikipedia, and Amazon’s gaming platform Twitch have signed up for Coil.