Why is XRP once again trading for more than $1? These are the main reasons

A very striking move this past week was the price increase of XRP, the cryptocurrency issued by the Californian company Ripple Labs. XRP rose by some 80%, while we mainly saw profit taking for the other major crypto coins.

XRP was one of the standouts during the 2017-2018 bull run, when the coin rose to $3. Many bought XRP back then and have been hoping for a comeback ever since, but a lawsuit from the US securities watchdog SEC prevented XRP from ever reaching new heights.

So why is XRP rising this time round? We present the main reasons below.

Bullish sentiment

Firstly, the crypto market is benefiting from an overall bullish sentiment at the moment. Everything seems to be going very well and so it makes sense that XRP, which was the third largest coin in terms of market capitalization back in 2020, is making a comeback.

Due to the relatively small value of the coin (around 1 dollar at the moment), many new investors think that XRP is cheap and therefore purchase this coin. Compared to a value of $90,000 for Bitcoin, $3,200 for Ethereum and $220 for Solana, XRP seems cheap.

‘Normies’ make the same mistake when they invest in Ethereum Classic instead of Ethereum.

There are also rumors about an upcoming ETF fund listing for XRP and a possible listing on Robinhood and other crypto platforms, but neither of those two would normally cause such a rise.

Gary Gensler

Second, there is speculation that SEC Chairman Gary Gensler will have to resign after the New Year. Gensler started a lawsuit against XRP years ago. Several analysts consider this SEC lawsuit to be the main reason why XRP has never been able to return to its 2017-2018 value in recent years.

Rumors of changes in crypto regulations under the newly elected Trump administration, which appear friendlier to digital currencies, are driving current market dynamics.

The possible changes at the top of the SEC make sentiment around XRP particularly optimistic.

No taxes

Third, there is a rumor that one of the latest crypto rules that Donald Trump’s new administration wants to introduce states that no taxes should be paid on profits made on American crypto coins.

Trump wants to give American crypto companies an advantage and hopes that American investors will buy local coins instead of digital coins issued by a foreign company.

Although Bitcoin is international, Ethereum is seen (by many) as Canadian-Russian (due to the nationality of Ethereum founder Vitalik Buterin), BNB as Chinese and Toncoin as Russian.

One of the most famous crypto coins that was developed is of course XRP, which is issued by Ripple Labs, the company of, among others Chris Larsen and Brad Garlinghouse

Other well-known American cryptocurrencies are Cardano (by Charles Hoskinson) and Dogecoin (designed by Billy Markus).