How to Use This Price Tracker
Cryptocurrency pricing data can help investors find opportunities in the market and make more informed investment decisions. NextAdvisor’s price tracker shows historical price, trading volume, market capitalization, and other important metrics for investors, especially those who are just starting to dip their toes into crypto investing.
While everyday investors probably don’t need every last bell and whistle to make informed investment decisions, there are some generally applicable key crypto metrics and indicators worth considering:
Crypto Indicators and Metrics for Beginner Investors
Price: As with any investment, price is where it starts and ends for investors. Pricing is highly volatile in cryptocurrency, but viewed over time can give investors an idea of how a given coin’s value has gone up (or down) over time.
Market Capitalization: In general, the higher the value of the market cap the safer the investment. Market cap is the total value of a cryptocurrency, and is calculated by multiplying the price of the cryptocurrency with the number of coins in circulation. The amount of tokens or coins circulating can be viewed as an indicator of a coin’s demand.
Volume: Higher volume typically means a given cryptocurrency has more market liquidity, meaning more ability for investors to sell an investment when they want to realize a profit. It represents how much crypto is bought and sold over a period of time, typically 24 hours.
XRP was among the first cryptocurrencies to launch after bitcoin minted the crypto market in 2010, with an eye toward faster and cheaper crypto transactions.
In 2012, three developers hoping to improve upon bitcoin launched the XRP Ledger — a decentralized blockchain with its native cryptocurrency XRP. XRP functions as a blockchain-based alternative to SWIFT, the global messaging system that enables bank transactions.
Think of it like a kind of currency that would make it easier for banks and financial institutions to transfer money around the world. The developers, along with Chris Larsen, went on to form a company called Ripple Labs the same year, which was gifted 80 billion XRP.
“Inherently, the idea is for XRP to replace the SWIFT network for cross-border transactions,” says Yoni Medhin, a crypto mining expert and a member of the advisory board for investing firm Energy Funders.
While XRP has a market cap that places it in the top 10 for crypto, regulatory issues with the Securities and Exchange Commission (SEC) have weighed on Ripple and XRP’s value. Ripple has been embroiled in a lawsuit brought by the SEC since 2020, making it the center of controversy in the crypto industry and difficult for investors in the United States to purchase XRP, according to Wendy O, a crypto expert and educator.
“The SEC is accusing them of offering unregistered securities, but they brought the suit somewhat late,” O says, referring to a lawsuit that revolves around the SEC’s view of XRP as a security, a view that’s at odds with Ripple’s claims that XRP is a currency.
How Does XRP Work?
Ripple describes itself as a global payments network and its native token XRP functions as a way to settle payments between financial institutions and digital asset exchanges. It gets rid of many of the transaction layers that result in higher fees, especially for international transactions.
“XRP enables financial transactions,” says Omar Qureshi, managing partner of High Tower Wealth Advisors. “You can view it as similar to MasterCard or Amex, although it’s not exactly the same.”
It’s important to note that Ripple and XRP are two different and totally independent entities, contrary to popular belief. Ripple is a San Francisco startup company that develops software that banks use to facilitate fast, global financial transactions, and the majority holder of cryptocurrency XRP.
Unlike bitcoin, which was released through a decentralized network of computers, XRP tokens were created and distributed by the founders of Ripple so that the company could build use cases around the digital asset. Basically, XRP powers the technology that Ripple is building.
What Gives XRP Its Value?
XRP is valuable for its ability to connect payments in a fast, cost-efficient way. According to Ripple’s website, you can send XRP from one digital wallet to another in just 3 to 5 seconds while paying minuscule fees.
But it has little utility beyond that, according to experts. There are also plenty of critics who say XRP…
Read More: XRP Price (XRP/USD) | Today’s Price