Earlier this week, crypto analyst Lord Crypto provided an update on the price action of XRP, the native token of the Ripple blockchain. In his initial post, Lord Crypto noted that the XRP price had been rejected from the $0.64 resistance level and fell below the $0.58 support line.
However, Lord Crypto remained bullish on XRP’s long-term potential, stating: “Ripple’s potential large share in the global CBDC landscape worth ~$5 trillion makes $XRP a gift at these levels. Having partnered with over 20 banks on CBDC projects, it’s only a matter of time before we see the demand for $XRP reflected on the charts.”
Central Bank Digital Currencies
The analyst cited Ripple’s involvement in central bank digital currency (CBDC) projects as a key driver of future XRP demand. CBDCs are government-issued digital versions of fiat currencies and the total addressable market is estimated at over $5 trillion. Ripple has partnered with over 20 banks and financial institutions to develop CBDC solutions using the XRP Ledger.
As more CBDCs are launched globally, it could substantially benefit XRP by driving utility and adoption. This potential increase in real-world usage may be reflected in XRP’s price over the longer term.
Short-Term Bearish Sentiment
In his follow-up post, Lord Crypto acknowledged the bearish sentiment currently surrounding XRP. He attributed this negativity to a recent transfer of 47 million XRP tokens to centralized exchanges.
“The bearish sentiment surrounding $XRP stems from the recent transfer of 47 million $XRP tokens to centralized exchanges,” the analyst explained.
When large amounts of a cryptocurrency are moved to exchanges, it can signal that the holders plan to sell. This influx of potential selling pressure tends to dampen market sentiment.
However, Lord Crypto noted that despite the bearishness, XRP’s price continues to adhere to an ascending support level in the $0.60 range.
Anticipated Price Action
The analyst closed by forecasting that if XRP maintains this support, its price could rise above the immediate resistance level within “a couple days.” Although the 47 million XRP transfer has fueled negative sentiment recently, Lord Crypto believes XRP can overcome the selling pressure in the short term.
As he stated previously, the cryptocurrency’s future role in the global CBDC landscape may drive substantial utility and user adoption over the longer term. XRP boasts significant long-term growth potential as Ripple continues expanding partnerships and use cases. While short-term price fluctuations are inevitable, the fundamentals appear strong for Ripple’s native asset.
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