XRP price hasn’t been that volatile of late, is it promising in the near term?

XRP price has been flat lately while the market has been pumping money in the past few days. Yet Ripple’s native token is down again, and it has dropped more than 5% in the past seven days, a timeframe in which BTC, ETH, and BNB are up around 10%.

xrp-price-hasnt-been-that-volatile-of-late-is-it-promising-in-the-near-term

At the time of writing, the sixth-largest cryptocurrency is changing hands at $1.09, down nearly 4% in the last 24 hours.

Will XRP price offer value to its investors in the long run?

The state of XRP’s on-chain metrics made things even more worrisome for short-term participants. The MVRV ratio has not been able to stay in the positive territory for long. It is used to assess the fair state of any token. Whenever this ratio is positive, the underlying token price is overvalued. Conversely, when it is negative, the token is undervalued, and investors are losing more value than usual in the market.

On 1 October, for instance, this ratio was as high as 5%, but by 2nd, it had shrunk down to 0.08%. After that, it managed to climb back to levels around 3% a couple of times but couldn’t sustain there for long. But on October 10, the index reflected a negative value of 3.4%, and at press time, it had also just emerged from the negative zone.

xrp-price-hasnt-been-that-volatile-of-late-is-it-promising-in-the-near-term

Source: Santiment

The inactive circulation registered two spikes at the end of the year. The attached chart below shows the number of unique XRP tokens moved after being inactive for 90 days. On October 1, more than 1 billion XRP tokens were displaced, while on October 15, the same number recorded a value of over 720 million.

Source: Santiment

The increased inactivity of whales often highlights a broader trend of accumulation. Since such tokens have been moved late, it is safe to say that the participants have started washing their hands with this token, and rightly so since XRP returns are pretty unattractive in the short term.

Usually, a token goes up in price thanks to the support of that project. But Ripple Labs doesn’t offer a unique service. The company offers an open-source payment system and has several competitors – on both the cryptocurrency board and off the board. It is said to have struggled to keep up with them.

And while many other players have also entered the field, Ripple has not outperformed the others. For example, SWIFT is being used by more than 11 thousand financial institutions in more than 200 countries. On the other hand, Ripple has only about a third of the institutions tied up, scattered across 45 countries.

Therefore, soon, as others in the same playing field develop their games, Ripple may not be the go-to protocol for cross-border payments. If that happens, XRP’s ranking will slide, and its price will suffer the most. Therefore, with the ever-evolving landscape, even investors are not guaranteed anything at this time. However, the goodwill that Ripple and XRP have forged over the years could potentially save the protocol if such a situation indeed occurs.

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