XRP, the token that supports Ripple’s ecosystem, has risen back above $0.40 after holding support at $0.39. Prior to this price increase, the international money transfer token faced resistance at its 2023 high of $0.4336. To maintain the uptrend, a daily close above the key $0.40 level is needed for bulls to move toward $0.55 and $1.00.
The conversation surrounding central bank-backed digital currencies (CBDCs) has been catching momentum, with Ripple mentioned frequently. As a cross-border payments network, Ripple is committed to helping countries achieve their digital currency goals.
XRP Price Steadies As Focus Shifts To CBDCs and NFTs
The untimely implosion of FTX exchange threatened the existence and validity of the crypto market. Regulators were concerned about the messy events that led to the fall of one of the industry’s largest exchanges that occurred in plain sight and worse off, under their watch. Investigation into the matter is still ongoing with the founder, Sam Bankman-Fried currently behind bars in the United States.
Many thought the fall of FTX would single-handedly squash interest in CBDCs, with central banks choosing to stop the ongoing research and developments. However, Ripple believes the new year brought forth “an opportunity for a reset of a fresh start.” Such optimism is essential for the crypto industry as the dust settles from a disastrous year characterized by negative headlines.
Looking forward into 2023, Ripple executives foresee the industry shifting focus to decentralized finance (DeFi), non-fungible tokens (NFTs), and CBDCs. In other words, expectations are centered around ensuring real-world utility and sustainability.
As reported on Tuesday, over 100 central banks globally are either working on systems to support the issuance of CBDCs or are involved in studies on these sovereign digital assets. The real-world application of crypto and blockchain solutions will likely bring the world closer to the era of CBDCs.
According to Ripple’s Europe Managing Director, Sendi Young, CBDCs have the potential to expand the role of central banks and ensure the financial inclusion of all people, especially the unbanked.
Other Ripple executives like James Wallis, the vice president of central bank engagements, are likely to see more CBDC pilot programs launched in 2023. However, he emphasizes the importance of interoperability among CBDCs to boost cross-border payments.
The shift to the real-world utility of crypto products will include NFTs with their focus going beyond the usual digital art and collectibles to the representation of real estate and carbon markets. According to David Schwartz, Ripple’s CTO, the emergence of real-world use cases of NFTS will determine which cases stick around for the future.
Ripple has a long history of working with central banks and payment providers like Mastercard. Its On-demand Liquidity (OLD) service allows banks to support faster and cheaper cross-border payments. The Bank of England (BoE) in a recent report, said that it is considering working with Ripple in its efforts to develop and launch a CBDC.
XRP Bulls In Check But Is It Time To Buy?
XRP price holds at $0.4 but appears to lack the momentum to keep the uptrend going in the current session. The cross-border token must close the day above this level to cement the bulls’ presence in the market and improve investor confidence.
A break above the upper range of the falling trend channel in confluence with the 200-day Exponential Moving Average (EMA) (in purple) would boost XRP price toward a medium-term target of $0.55 before stretching the leg toward $1.00.
On the other side of the fence, XRP’s immediate support has been provided by a strong confluence of around $0.39. The 50-day EMA (in red), the 100-day EMA (in blue), and the lower range of the trend channel reinforce this crucial support area.
As long as XRP price holds above the support highlighted at $0.39, the path with the least resistance will stick to the upside. A sell signal from the Moving Average Convergence Divergence (MACD) indicator could stifle the plausible upswing in XRP price, at least to $0.55.
If the MACD line in blue holds below the signal line in red, XRP price may be forced to fall back to lower support established at $0.35. Such a move although undesired would allow already sidelined investors to buy XRP, in turn, building momentum for the uptick to $0.55 and $1.00, in that order.
Meanwhile, the crypto community is waiting with bated breath for the final ruling in the case involving Ripple and the Securities and Exchange Commission (SEC). The former accused Ripple of selling unregistered securities in XRP tokens, thus violating US securities laws.
The case has dragged on for more than two years but a final ruling is expected possibly before the end of Q2 2023. Both Ripple and the SEC filed their final submissions in December.
XRP investors are hopeful Ripple will win the case, following a recent case between the SEC and LBRY, a crypto-based sharing platform. The regulator had accused LBRY of selling LBC tokens as unregistered securities, but the judge ruled the tokens could only be considered securities at the time of the direct sale.
The LBTY vs SEC case could set precedence for the Ripple vs SEC lawsuit, with investors hopeful the judge will rule in the favor of the blockchain startup. LBC tokens rallied following the ruling and the same is expected for XRP price if Ripple wins the case.
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