Ripple forecast: is it worth investing in 2023?

Many investors take advantage of the end of the year to reassess their investment portfolio in view of expectations for the following year, and with cryptoasset investors this is no different. To help you right now, today we are going to talk about the forecast for Ripple in 2023.

Launched 10 years ago, Ripple is one of the best known crypto assets in the world, with a daily trading volume of around 1 billion dollars daily even after the tough bear market of 2022, being among the 10 largest assets either by traded volumes or capitalization market.

First, it is always good to make it clear that it is impossible to accurately forecast Ripple or any other variable income asset, after all, there is no way to set the price of an asset at a future time or what could happen.

The idea in this article is to map the main points that can bring volatility to the price of Ripple in 2023 , whether due to macroeconomic, regulatory and even the company responsible for the crypto asset XRP.

What is Ripple (XRP)?

Ripple Labs is a financial technology company that created the Ripple crypto asset (XRP) and a real-time payments platform called RippleNet .

Since its launch in 2013, XRP has become one of the most popular crypto assets in the world, with a market capitalization that has surpassed $100 billion at times.

Focused on developing fast, secure and low-cost international payment solutions, Ripple Labs was one of the first companies to bring crypto technology to traditional financial institutions.

The financial transaction protocol we know as Ripple, its Ripple Ledger network (XRPL) and its native currency XRP were launched in 2012.

Unlike Bitcoin, XRP is not obtained by mining, having a total issuance of 100 billion XRP at the time of the creation of the protocol. But all these tokens are not in circulation: the supply is set by Ripple Labs as more users transact in XRPL and by the end of 2022 it is at approximately 50 billion circulating tokens.

What is Ripple and XRP used for?

Ripple was created with the aim of facilitating low-cost, high-speed global financial transactions . One of the main uses of XRP is as an exchange currency for financial transactions.

It can be used to convert one country’s currency into another national currency quickly and efficiently without the need to use a correspondent bank or go through a slower and more expensive currency conversion process.

For this reason, XRP is especially attractive for companies that make large international payments or for financial institutions that need a reliable and inexpensive settlement system. Furthermore, XRP is traded on several cryptocurrency exchanges and can be used as an investment medium.

However, unlike other cryptocurrencies such as Bitcoin, which proposes to be used in payments for goods and services in a decentralized way and without the need for intermediaries, XRP was specifically designed to be used in financial settlements, currency exchange and interconnection. with payment network of financial institutions.

The SEC lawsuit against Ripple throughout 2022

Of course, RippleNet, a product made to compete with financial settlement solutions in the traditional market such as the SWIFT system, admittedly expensive, slow and bureaucratic, would gain some enemies in its journey, and Ripple was no different.

Regarded as one of the most important cases in the history of the crypto market, the legal battle between Ripple Labs and the SEC (Securities and Exchange Commission of the United States) is always on the agenda of commentators in this market. The case has been widely discussed by analysts and investors alike, as it could have significant implications for the price of the XRP crypto asset and for the crypto market as a whole .

It all started in December 2020, when the SEC filed a civil lawsuit against Ripple Labs, its CEO Brad Garlinghouse and co-founder Chris Larson, claiming that they sold XRP as an unregistered security, which would violate the SEC’s own rules, and the process drags on to this day in American courts.

The SEC argues that Ripple sold over $1.3 billion worth of XRP to investors in the US and around the world without registering the asset as a security.

As a result of the process and the still nebulous regulatory situation, several US-based brokerages stopped offering XRP to their customers, directly impacting the offer of the asset in the country.

For its part, Ripple Labs denies the SEC’s allegations and argues that XRP is a digital currency, not a security . The company claims that XRP was created to be used as a way to transfer money across the world quickly and cheaply, not as an investment.

What to expect from the legal battle between Ripple and SEC in 2023?

The lawsuit has been widely watched by the crypto market and has been the main trigger for XRP volatility ever since, and could have an outcome in 2023. If Ripple loses the lawsuit, it could lead to a ban on the sale of XRP in the US and the a fall in the price of the asset.

However, if Ripple wins the lawsuit, it could lead to an increase in the price of XRP, as the uncertainty over its legal status would be removed in the richest country in the world.

Furthermore, the lawsuit could have a significant impact on the cryptocurrency market as a whole. If Ripple wins the lawsuit, it could bolster investor confidence in the crypto market and lead to an increase in the prices of other crypto assets. But if it loses, it can lead to a decrease in investor confidence and bring more short-term losses to the market as a whole.