A year in the life of Ripple XRP cryptocurrency

May 06, 2018
Chris Wheal

Ripple’s XRP has been one of the world’s most volatile cryptocurrencies, with the some of the biggest daily swings to both the upside and downside.

During 2017 alone, the crypto had surged by some 36,000%. By early January this year, XRP had soared well past the $3 mark, making it the second biggest crypto by market cap at that time.

A seemingly never-ending stream of positive news from Ripple helped the crypto to disproportionately benefit from the wave of general euphoria that swept crypto markets towards the end of 2017 and into the beginning of 2018.

At one point in early January, the XRP rally meant Ripple co-founder Chris Larsen was richer than Facebook founder Mark Zuckerberg.

Hard landing

That also partly explains why XRP had such a hard landing when crypto prices in general went into reverse this year. Worries over regulation have hit XRP, especially in the light of the ongoing debate over the crypto’s degree of centralisation.

XRP now stands at $0.67, well down from the high of $3.84 reached in January this year. Though the current price is still more than double the level it stood at a year ago. In terms of market cap, XRP is currently the world’s third biggest, with just over $26bn, but well behind second place Ethereum, at $69bn.

There are a range of opinions on where XRP’s price will go from here. However, as it has experienced two 100% price increases in its history, many see XRP as having very strong upside potential, especially at times when investor sentiment on cryptocurrencies in general is positive.

XRP trading volumes shot up in December and January at the height of the crypto bull market but fell back sharply in February as prices slumped. Volumes are average at present, leading few to expect any especially sharp price rises or falls in the near term. At least relative to XRP’s volatile price history that is.


XRP coin and chart

Banking community

The past year has seen a continuation of the trend witnessed over the past few years, with Ripple winning increasing support from the global banking community for its RippleNet payment system. RippleNet allows banks and payment providers to send money around the world much more quickly and cheaply than traditional systems.

Money can be sent either as XRP, other cryptos or as traditional fiat currencies through the network. Ripple’s blockchain technology means payments can settle through RippleNet in just 4 seconds versus a three-to-five-day settlement time for traditional payment systems.

The increasing take-up of RippleNet has provided support for XRP amid speculation there will be ever rising demand for the crypto by banks and payment providers as they use it as a bridging currency.

Exchange listings

Around this time last year, XRP received a major boost from news that various exchanges around the world would begin listing it for the first time. After securing listings on crypto exchanges Bitstamp and Kraken, Ripple announced XRP would also be coming to other exchanges such as Bitso, Coinone, bitbank, BuyBitcoin and QRYPTO. Ripple said the signups would help increase the liquidity of XRP.

However, XRP has also been dogged by worries over the reluctance of certain exchanges to list it, despite being one of the biggest cryptos in the world by market cap. Coinbase, one of the world’s biggest exchanges, has refused to list XRP.

Worries over the centralisation of XRP in terms of the control exercised by Ripple itself are generally cited as the likely reason for the decision. Most XRP coins are still controlled by Ripple. Unlike Bitcoin, and many other leading cryptos that are totally decentralised, XRP cannot be digitally mined.

All the XRP coins in circulation were created by Ripple itself in 2012, which was then called OpenCoin. When XRP was launched, 80% of coins were allocated to OpenCoin, while 20% went to the individual founders.

A recent study, retweeted by Coinbase chief executive Brian Armstrong, depicted XRP as being the world’s most centralised crypto in terms of XRP coin holdings. It claimed 97% of the circulating supply of XRP was being held by the top 100 accounts.


Brian Armstrong

Commercial appeal

Many of the other news announcements from Ripple over the past year have generally shown that its technology is gaining increasing commercial appeal.

In October, Ripple revealed it had reached the milestone of over 100 financial institutions joining RippleNet. “Network effects take off as payments volume builds and financial institutions begin to tap XRP to unlock the full value of blockchain,” claimed Ripple at the time.

Ripple increasing portrayed RippleNet and XRP as an ideal way for firms to process remittances across the world, pointing to the low-cost and high-speed advantages of its technology. For instance, certain firms signed up to the platform to tap the Indian market, with the country ranked as the largest beneficiary of retail remittances worldwide, at $71bn annually.

Ripple announced take-up with financial institutions as far apart as Australia and Latin America. The following month, and just prior to the explosion in XRP’s price that eventually saw it breach the $3 barrier, Ripple revealed that American Express would be joining RippleNet in partnership with existing member Santander.


While already being based in San Francisco itself, the onboarding of a big US household name gave Ripple and XRP a major credibility boost with US-based investors. The deal would initially see RippleNet connect America Express to Santander in the UK, enabling American Express customers to send money to UK bank accounts.

In early January, Ripple announced another major deal with a US-based name – this time it was MoneyGram, one of the world’s largest money transfer companies. MoneyGram was to pilot the use of xRapid, a Ripple digital payments solution that solely uses XRP. Ripple emphasises the attraction of xRapid for making payments in emerging markets. This underlines one of the principal themes of Ripple’s strategy over the past 12 months.

In February, the crypto firm also revealed it had signed up five new customers as part of a concerted drive into emerging markets payments – this time for RippleNet.

“RippleNet can provide instant access into emerging markets such as India, Brazil and China. Emerging markets are home to 85% of the global population and nearly 90% of people under 30 reside within those markets. Given the demographics, these countries are some of the world’s largest remittance markets,” said Ripple at the time.

American Express

American Express building

Long-term future

At present, the single biggest impediment to XRP’s rise is arguably the threat of increased regulation and how regulators decide to classify the crypto. Some fear that regulators could even decide that XRP should be treated as a de facto company security as Ripple still owns most of the coins and technically exerts some control over the crypto.

As the argument goes, for the same reason, cryptos such as Bitcoin that can be digitally mined freely and are completely decentralised should be more loosely regulated.

Undeniably, however, Ripple’s technology has huge commercial appeal. While there is debate over how much XRP financial institutions will use to facilitate payments through RippleNet, services such as xRapid, which exclusively uses XRP, should also help cement the crypto’s long-term future.

Along with MoneyGram, payment names such as MercuryFX and IDT have also adopted xRapid. Ripple has just revealed that in addition to dramatically cutting payment times, the first pilot tests resulted in savings of 40-70%.

Dennis de Jong

Dennis de Jong

Views on Ripple and XRP

Alastair Constance, chief executive and founder at Mercury FX: “Digital assets promise fast transaction speeds but XRP is far faster than all of them, including Bitcoin. Cutting settlement times from hours and days to just three seconds or less will remove billions of dollars in unnecessary intermediary fees.”

Naeem Aslam, chief markets analyst for ThinkMarkets: “If there was a bull market in crypto, Ripple would explode.”

Dennis de Jong, managing director at UFX: “The fact that the likes of American Express and Santander have signed up shows it certainly is an attractive proposition that should grow and grow.”

Gabriele Giancola, co-founder of qiibe: “While Bitcoin is now associated with drug scandals and money laundering, Ripple is a coin that people trust, so the difference will be a huge factor in Ripple recovering from its price slump in future.”

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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