Ripple with the beginning of the year fell by 86%. What is happening and what to expect from coins
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Ripple is one of the fastest growing coins last year. Its rate for 12 months soared by 36 thousand percent, making the cryptocurrency founder Chris Larsen, the eighth in the list of the richest people in the world. However, in January the situation has changed: the Ripple went into a steep dive and for the next three months lost 86% of the cost. Continues to drop. Figured out why it failed the third by market capitalization of cryptocurrency, and if she has a chance to win back the position.
theWhy fell Ripple
a Record high of 3.8 per dollar Ripple reached on 4 January 2018. At the time of publication the exchange rate of coins was 0.49 per dollar, and the market capitalization of 19.5 billion dollars (minus $ 120 billion by the beginning of the year).
Ripple and XRP are substantially different from Bitcoin and Ether. The coin is centralized — that is, its market volume is not determined by actions of investors, and the company's plans. In addition, the developers make a major bet on interaction with the business, not just with users. The latter has repeatedly accused the Ripple in the promotion of a payment platform for banks (works similar to SWIFT, you'll be minimal commissions and transaction rate) to the detriment of coins XRP.
Business model Ripple — one of the main problems of the project from the user's point of view. According to own data of the company, clients platform are 100 financial institutions around the world. Among them, UBS, Royal Bank of Canada, Wells Fargo and others. However, banks are only interested in the Ripple payment platform through which they can make fast and cheap translations, but not the XRP. Due to the volatility of the coins to financial institutions easier to create your own cryptocurrency. "No Bank in their right mind would buy XRP where the rate per day can vary by 20%", — trader Ben fried. Over time, people realized that the coin is designed for business, not private investors. Banks cryptocurrency turned out to be uninteresting. The result was a reduction in investment and the depreciation.
theKorean question
Most of the transactions Ripple is concentrated in South Korea, and the price of the coin at the local exchanges in the beginning of the year was almost 50% higher than the world average. In January, the service CoinMarketCap without explanation stopped to consider South Korean quotes Ripple and other cryptocurrencies of the top five in the counting rate of the coin. This decision strongly influenced the price of the coin coin for the day fell by 32%.
the Fall has provoked a wave of panic and the sale of cryptocurrency. Another blow was to check on the South Korean stock exchanges, which took place after the head of the Ministry of justice of the country, Park sang-Ki. The that cryptocurrencies contribute to the corruption of youth, and called to close all crypto currency exchange in the country.
And finally, the fall — a consequence of the correction of the course of bitcoin. This process is typical for almost all coins, which have passed the stage of rapid growth. Among them Bitcoin, and Litecoin Broadcast.
theProspects Ripple
the Developers of a cryptocurrency are trying to change the position of the coins. Director brad Garlinghouse in March that the platform intends to invest in technology startups that develop solutions in the area of payments. Such a move will improve the liquidity of XRP and cause the growth rate of the coins, he said.
meanwhile, the company has no plans to change its strategy: the Ripple will continue to focus on cooperation with banks. "We will focus on how to allow banks to use their software solutions. Of course, we will also cooperate with companies which want to use XRP in many different ways and to develop the coin," said Arlinghaus.
What will happen to the rate of Ripple and XRP — time will tell. As TechCrunch, the platform Ripple can exist with zero rate of coins. In this case, the company will be able to replace it with any other crypto or even Fiat currency.
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