XRP is currently facing a turbulent market, shedding 5.6% in the last 24 hours to trade at $2.06. At 46% lower than its all-time high, XRP is among one of the worst performers among the top 10 cryptocurrencies.
However, there are signs that the trend may be improving. XRP’s market cap currently stands at $118 billion at the current price, a significant progress from $28 billion on November 1. Analysts also point to signs of a bullish divergence that could signal a near-term recovery. If XRP can reclaim its historical market cap ratio relative to Bitcoin, its valuation could rise substantially.
Historical XRP Performance and Ripple’s Lawsuit
XRP reached its all-time high market valuation of $165 billion on December 3, 2024, when its price hit $2.9—a seven-year high. Before this, XRP’s peak valuation was $128.5 billion in January 2018, representing 49.4% of Bitcoin’s $260.05 billion market cap at the time.
Several factors have contributed to XRP’s price volatility over the years. These include Ripple’s lawsuit, initiated by the SEC in December 2020, and XRP’s failure to set a new peak during the 2020/2021 bull run.
As of January 1, 2024, XRP’s market cap had dropped to $33 billion, capturing just 3.9% of Bitcoin’s $838 billion market cap. Today, XRP accounts for 6.8% of Bitcoin’s $1.93 trillion market valuation, a significant increase but still far from the 49.4% ratio achieved in 2018.
Despite this cycle’s higher valuation, XRP captures a much smaller share of Bitcoin’s market cap than it did in 2018.
What If XRP Recaptures Its Bitcoin Market Cap Ratio?
Market analysts speculate on XRP’s potential if it were to reclaim its 2018 ratio of Bitcoin’s market cap. If XRP reached 49.4% of Bitcoin’s current $1.93 trillion valuation, its market cap would soar to $953 billion.
Given XRP’s circulating supply of 57.25 billion tokens, this valuation translates to a price of $16.6—a staggering 621% increase from its current price. This projection aligns with market expert EGRAG’s analysis, which used Linear Regression to identify $16 as one of XRP’s key price targets.
Essentially, historical trends suggest a promising outlook for XRP holders, especially if the asset mirrors the previous patterns. Analysts believe XRP is on course with historical trends.
Ripple’s Lawsuit and Market Outlook
The SEC’s lawsuit against Ripple remains a central issue for XRP. Ripple’s legal team insists the January 15, 2025, SEC appeal deadline will not alter Judge Analisa Torres’s ruling that XRP is not a security.
Adding to the optimism, pro-crypto leadership under Paul Atkins, who is expected to lead the SEC, could favor a settlement or withdrawal of the case. Experts predict such developments could spur XRP to regain momentum to break new all-time highs.
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