Digital Fiat and CBDCs Might Make XRP Obsolete. XRP’s role as a remittance coin is slowly losing traction as stablecoins have shot to the limelight thanks to DeFi and Tether being used as a fiat onramp in China.
In the case of Central Bank Digital Currencies, multiple countries and regions are exploring the use of CBDCs. They include China, England, Japan, Euro Zone, Sweden, and Switzerland.
The United States has also been flirting with the idea as seen through the ongoing debate on how to best distribute stimulus checks/funds.
With respect to the latter, a recent report by Bitstamp and Coinmetrics explained how this has come to be.
…stablecoins can serve as replacements for fiat onramps and provide liquidity for crypto investors who do not have a direct fiat gateway. This is especially important in countries that have relatively strict restrictions on cryptoasset trading, like China.
Past research has shown that USDT_ETH is redominantly transferred during Asian and European market hours.
The Flare Network Can Increase XRP’s User Base
In an earlier analysis, it was concluded that crypto traders still prefer XRP when transferring funds between exchanges. This is due to the efficiency of the XRP ledger that allows for the quick and cheap transfer of funds between exchange wallets.
This means there are traders who know of XRP’s capabilities. Therefore, by borrowing a leaf from other projects such as Tron (TRX), Ethereum (ETH) or even LINK, XRP needs additional real use cases. TRX, ETH and LINK have shot to glory through smart contracts that are powering the DeFi boom.
Therefore, the Flare Network might just be what the doctor ordered for XRP. The Flare Network plans to build a two-way bridge connecting XRP with the Ethereum network. Flare plans on integrating the Ethereum Virtual Machine to introduce smart contracts on the XRP network. The team has provided information on how this will work via the following tweet.
@bgarlinghouse: «Flare is combining the best of XRP (VERY fast settlement), Ethereum (smart contracts) and Avalanche (consensus) which helps extend XRP’s utility and allows developers to create smart contracts for new use cases like lending and De-Fi» #Cryptotownhall w/@tomemmer
– Flare (@FlareNetworks) August 20, 2020
If the Flare network can succeed in bringing Smart Contracts to the XRP network, its user base will definitely increase as DeFi protocols will be created to capitalize on the global popularity of XRP. The digital asset is still the number 3 digital asset on Coinmarketcap hinting that it has an appeal to investors and traders.
- Timothy Peterson’s recent analysis of XRP paints a stagnant future for the digital asset
- He explains that XRP may never reach $1 let alone $10
- His analysis is based on low user growth and digital fiat threatening XRP
- He also points out XRP is one of Grayscale’s smallest funds.
Crypto analyst Timothy Peterson of Cane Island Alternative Advisors has shared a densely packed price analysis of XRP. According to Mr. Peterson, XRP may never reach the $1 value let alone $10. He provides two reasons why XRP’s future value looks stagnant.
To begin with, be cites that XRP user growth is not there. Secondly, digital fiat is a threat to XRP. To sum up his analysis, he highlights that XRP is one of Grayscale’s smallest funds thus indicating there is no investor interest in the remittance coin.
Mr. Peterson’s analysis of XRP was made via the following Tweet.
#Ripple $XRP may never reach $1 let alone $10. The user growth just isn’t there and digital fiat is a threat. It is one of Grayscale’s smallest funds, so it doesn’t seem like there’s much investor interest either.
– Timothy Peterson (@nsquaredcrypto) August 27, 2020