2020-1-27 17:30 |
In a recent episode of Boom Bust, anchor Christy Ai, stated that we’re “expected to see a major devaluation” of Ripple’s XRP asset, following a discussion about the company’s IPO announcement. XRP is ‘Not Worth’ its Current Price Based on Ripple’s generation of financing over the years by selling actual XRP, the IPO may strike a blow against the value of the native cryptocurrency. Recent news commentary raised doubts whether $0.22 was fair value for XRP. Boom Bust Anchor, Christy Ai, asserted that traders are not using XRP for its utility, they’re primarily interested in speculative future gains. Right now, half the people at XRP they are not using it for the actual utility, they are holding it like an investment. Back when it ballooned to $3, or even now when it’s at $0.22, that value as a utility token, it’s not worth $0.22. So we’re expected to see a major devaluation even though it does have a utility purpose. [18.56] This suggested that XRP could be in for a significant price drop if the only thing that’s supporting the asset’s value right now is speculative investors. Interesting point of view from RT talking heads on Ripple and value of XRP in context to IPO – 14:40 mark. https://t.co/ilH8wyqEKV — Jerryvhall (@Jerryvhall1) January 26, 2020 Ripple has sold up to $1.22 billion worth of XRP, as a tool to finance its business. On this topic, Ai commented that if Ripple decides to sell shares and go public, “XRP could potentially be worthless…obsolete.” Ai further added investors may be angered by Ripple’s move to also issue shares and go public. But Jeffrey Tucker, editorial director at AIER, believes it is not so straightforward to estimate the effect on XRP. I think what they’re actually worth is what they are buying and selling for right now. He continued, Anything could happen, XRP could fall to zero but it could also be worth a million dollars… crypto is a complicated technology, it can’t be valued the same way you’re valuing stocks Tucker conceded that the asset may hold some speculative interests, just like other digital coins, but it is impossible to predict the future. For Ripple, the chief idea has been to always try to work alongside with traditional finance, commented Tucker. So an IPO will not be the same as issuing a token that is trading on crypto exchanges. Transactions remain relatively low Having shares of Ripple will also mean XRP may turn into a utility asset. As a utility, XRP can be theoretically used within RippleNet – however, critics note that very few are actually using XRP for transactions or remittances. In the past few months, XRP transactions increased to above 1.6 million per day, with some significant spikes. Overall, however, the number of XRP transactions is relatively low, comparable to the levels on the Ethereum and Bitcoin networks. This is despite the promises from Ripple that it can scale far beyond those transaction levels, and compete with the business of payment processors like VISA. But the asset is still getting evaluated on its potential to also be considered unregistered security, as early investors claim in a court case against Ripple. What do you think about XRP’s value as a utility token? Share your thoughts in the comments section below! Images via Shutterstock, Twitter @Jerryvhall1 The post appeared first on Bitcoinist.com.
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