XRP ended 2019 as the worst performing cryptocurrency of the year. Unfortunately for cardholders, this trend has persisted until now in 2020.
It was a forgettable 2019 for Ripple’s XRP. But unfortunately, 2020 remains bad, according to a new report by cryptocurrency analyst firm Messari.
A token of questionable origin, XRP was the worst performing cryptocurrency among the top 25 currencies by market value in the first quarter of the year, Messari said. The currency currently faces historical lows of $ 0.18 per currency.
There are several potential reasons, internal and external, that could adversely affect XRP’s performance this year so far.
At the market level, panic over the consequences of the coronavirus pandemic played a key role in shaping the bearish sentiment among investors. However, in addition to the virus, the shares of Ripple (the company) may also have contributed to this decline.
“Earlier this year, Brad Garlinghouse, CEO of Ripple, revealed that Ripple would not be profitable or would have positive cash flow without selling XRP, indicating that its XRP sales were really helping to finance the business,” noted Messari.
Xip’s sales by Ripple have been an explosive problem in the crypto market. On the one hand, Ripple has always been clear and transparent in revealing its sales, publicly stating that the company does not care much about the price of XRP and does not intend to permanently end this practice. On the other hand, XRP holders have stood out on social media in expressing their discontent.
Messari also noted that uncertainty about the nature of XRP may be playing an important role in triggering a pessimistic outlook among investors. Currently, Ripple is facing a class action lawsuit that alleges that XRP was illegally sold as an unregistered security under US federal law.
But while the immediate future may look bleak for the XRP Army, there have been some positive developments for Ripple fans.
The company recently established strategic partnerships to expand the ecosystem, including expanding its business in the US-Mexico shipping market, which could play an important role in adopting XRP. Meanwhile, Bitmex, recently announced plans to offer its first XRP perpetual swap contracts, which could also help stimulate XRP trade in the future.