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If you ask a group of experts in technical market analysis what is most important, you are sure to get only one answer from all of them: the price. Of a merchandise, an asset, a currency, an action, whatever. That applies to most Ripple XRP enthusiasts and also to any other cryptocurrency operator. The price is king because that's how to make money, watching how the price rises and falls in the market, identifies trends, buys at the right time and also sells at the right time. Time will be the second most important thing. That is the game in technical analysis.
But any expert worth your salt will also tell you this: price and value are different things. If you want to earn money by following prices, then the technical analysis is for you. If you want to make money evaluating the value, then there is another discipline called "fundamental analysis" that will help you.
Fortunes have been made using both tools, separately or in tandem. Take Warren Buffet. He has made a fortune by identifying to value the lowest price, buy it and wait until the market realizes its error and rectifies it, which raises prices.
Why do we tell you all this? Well, basically because Ripple's XRP is very cheap now ($ 0.3493 as we write) but also because it is valuable. A fundamental analysis published a couple of weeks ago estimated that the actual value of XRP will be around $ 1.7 USD, which is five times its current price. How is that possible?
It all comes down to utility. XRP is useful. Maybe not for you or for me directly (although that is changing rapidly) but for banks around the world, remittance services and other financial institutions. Because it is so useful, it is destined to be massively adopted and demanded in large volumes.
Ripple's goal has been to create blockchain-based software and technologies that can eliminate all or most of the friction inherent in the settlement of international payments. That has been his mission for years, and he has persuaded many of the largest banks in the world to get on the car. In order to do Ripple's things, banks do not need to have foreign currencies to transfer money across borders.
What they do to use Ripple's ledger, use their local currency to buy XRP, send those XRP to the bank on the other side of the transfer. That bank then exchanges the XRP tokens for their local currency and, therefore, the deal is made. The whole process takes less than five minutes and the rate is fractions of a penny.
If you are used to buying products on Amazon, or anywhere else on the Internet, it is not too impressive, since online payments are usually very fast. But if you have ever needed to transfer money abroad, know that the process is quite painful.
You need a large number of red ribbons, it takes at least three days to settle and it is very expensive (usually a flat fee of USD 25 per transfer or the percentage of the amount sent), and is not as reliable as it should be. That is why remittance services such as Western Union or Moneygram have been so successful (and also used by pilot programs to use the XRP).
So you know XRP maybe cheap yet. But it is valuable, and most likely the market will pick up before you know it.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. The Global Currency Report and its affiliates, employees, writers and subcontractors are cryptocurrency investors and, from time to time, may or may not have holdings in some of the currencies or tokens they cover. Perform your own thorough investigation before investing in any cryptocurrency and read our full disclaimer.
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