Ripple, has had a lot of partnerships with major banking institutions around the world. However, these partnerships have not had a huge impact on the XRP price.
Below is an analysis of whether the partnerships are likely to have any positive impact on the price of XRP.
At the time of writing, XRP is changing hands at $0.5299 which indicates a steep decline from earlier months and more than 80 percent decline from its January highs of $3. The market capitalization has also fallen deeply from a high of $123.97 billion on 4th January to $21.305 billion at the time of writing.
This is after ripple fostering working relationships with leading financial firms like Santander. According to a research posted on Brave NewCoin, “Transactions per day have continued to decline since January, and are currently at levels last seen in 2014.” This is despite the lower transaction fees charged.
The decline in transactions seems to be connected with how the XRP price has been on the decline since February this year. A point to note is that dwindling transactions per day indicate that lower amounts of XRP are traversing ripple’s blockchain.
The decline in price, which has been compared to levels evident four years ago, comes at a time when ripple has had so many partnerships unlike back them when such adoption levels were only imagined.
The disparity between price and partnerships can be attributed to the fact that most of these financial institutions tap into ripple’s platform without making use of the platforms native coin.
“The suite of tools for enterprise and banking solutions that make up RippleNet is currently available in 40 countries.” These tools include the much adopted xCurrent which steers away from the XRP coin. xCurrent is used by banks to process bank to bank payments on a global scale. The tool that integrates the use of XRP, xRapid, sources on-demand liquidity by transacting the XRP coin and was recently launched.
xVia, another tool from ripple labs, allows for the sending of unidirectional payments.
Other tools include:
“Interledger, Coil, and Codius, all of which are related in terms of functions and development teams. The Interledger Protocol (ILP) is capable of sending payments across different distributed and decentralized ledgers, moving funds via intermediaries. Coil enables subscription-based donations for content monetization on the internet, without advertising or selling user data, and pays sites in real-time through a Web Monetization API”
Additionally, despite the partnerships, the popularity of XRP has been on the decline with google recording lower searches for the term ‘XRR price’ although September saw a slight rise in searches.
Previous studies have shown that there is a relationship between the google searches and the price. For example, the price of bitcoin is negatively affected when google trends show a ‘dramatic’ increase in ‘bitcoin’ searches in the United States.
The study also notes that there has been a decline in the daily active addresses with the current numbers replicating what was seen in 2017 between the months of July and October.
Is there hope for the XRP price to gain from these partnerships?
Yes, of course.
The major reason for the above scenario is that the partnerships do not employ XRP. But this is about to change with the launch of xRapid.
Financial institutions looking to use this solution will have to incorporate the use of XRP coin. Ripple has also indicated that major banks around the world will be using XRP ‘very soon’. This was indicated by Sagar Sarbhai who is the head of regulatory relations for the Middle East and the Asia-Pacific at Ripple. Sagar’s comments were enough to unseat ETH on the second position on the top cryptocurrencies list. It also led to an increased XRP price appreciation in September.
With the launch of xRapid coupled with Sarbhai’s sentiments, it may seem like ripple will start pushing for the use of XRP in future partnerships driving the XRP price higher.
Additionally, to keep its community pumped, they should be explaining to their following how these partnerships are going to benefit them whether in the short or long term.
The XRP price can only regain its previous glory from partnerships and more growth which experts anticipate will be soon after the bears get back to their caves.