- Major U.S. stock indexes and cryptocurrency markets experienced sharp swings in early 2024.
- XRP reached its highest price since 2018 before falling sharply.
- Ripple Labs partners with major banks, but these relationships do not guarantee demand for XRP.
- XRP faces increased competition from stablecoins due to their price stability.
- Analysts say XRP could reach previous highs again, but warn much of the momentum may be driven by hype.
The year 2024 has seen significant volatility in financial markets. Through early May, the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all recorded major fluctuations. Cryptocurrency prices followed similar trends, with tokens like Bitcoin and XRP displaying sharp gains and losses.
Between February and April, U.S. stock indexes dropped more than 16% before recovering over 13% in a month. The Nasdaq Composite saw an even steeper swing, falling 23% and then climbing 25%. In the crypto sector, Bitcoin hit a record high in January before dropping almost 30%, then rebounding nearly 50% to set a new high above $111,000 by late May. XRP also surged to its highest price since 2018 before losing nearly half its value, currently trading around $2.40.
According to data from Ripple Labs, the company behind XRP, the crypto token aims to make cross-border payments faster and cheaper for financial institutions. The company has partnerships with large banks, including Bank of America and JPMorgan Chase. However, industry sources clarify that these banks use different products from Ripple Labs—not all of which require holding or transacting with XRP.
Ripple Labs offers two solutions: On-Demand Liquidity (ODL), which uses the XRP token, and RippleNet, which does not. Financial institutions can use RippleNet for payment processing without needing to purchase XRP. ODL is designed to help companies with liquidity challenges, such as fintechs focused on remittance services, rather than large banks.
Experts point out that as competition in the crypto payments sector grows, more institutions prefer stablecoins—cryptocurrencies that are pegged to stable assets like the U.S. dollar. Stablecoins help minimize price volatility, unlike XRP, which can experience large daily price swings. This advantage leads some banks and governments to develop their own stablecoins, reducing reliance on XRP.
While XRP has established itself as a credible cryptocurrency with real-world use cases, analysts note, “investors are overlooking a fundamental distinction—the difference between RippleNet and ODL—that undermines XRP’s most compelling argument for long-term price appreciation.” The outlook for XRP suggests the price could climb to $3 again, but experts caution that such moves would likely be driven by market enthusiasm rather than institutional adoption.
Other details indicate that among leading cryptocurrencies, XRP remains below its previous peaks despite some recovery. The widespread use of Ripple Labs technology does not automatically translate to increased XRP demand or price gains, due to the separate functions of its payment products.
✅ Follow BITNEWSBOT on Telegram, Facebook, LinkedIn, X.com, and Google News for instant updates.
Previous Articles:
- Pakistan Allocates 2,000MW for Bitcoin Mining, AI Centers Amid Reforms
- Manhattan Crypto Investor Charged With Kidnapping, Torture for BTC
- Cathie Wood: Crypto ETFs to Stay Relevant Despite Wallet Growth
- Crypto Investor Arrested Barefoot in Bathrobe After NYC Raid
- Judge Overturns Mango Markets Fraud Conviction Against Eisenberg
