Ripple's native token, XRP, is trading in the $3 range on Thursday, and bulls are waiting for its price to reach $4 and subsequently $5. It took seven years for the leading altcoin to reclaim the $3 mark, which it first left in 2018. Traders hope that the next jump from $3 to $5 will happen quickly, rather than waiting another seven years. This puts a lot of expectations on the altcoin, where investors are hopeful of riding another bull run for profits.
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How Will Ripple's XRP Reach the $5 Milestone?
For Ripple's XRP to reach $5, it needs to maneuver its circulating supply of 55 billion tokens and increase its market cap. The altcoin needs to see its market cap reach a minimum threshold of $275 billion. That's close to another $97 billion, which might not be possible without an increase in the number of new investors. Traders who already hold XRP are less likely to keep investing when it's above $3.
The increase in the number of new users could come in three ways. One is when the cryptocurrency market ignites a fresh bull run, drawing attention from new investors worldwide. The other is when Ripple expands its payment services to many more global banks and fintech firms, leveraging blockchain technology. The final is when it receives regulatory clarity from the SEC on the lawsuit. If these are met, Ripple's XRP has a chance of reaching $5, increasing its market cap to $275 billion.
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Ripple's market cap is currently at $178 billion and is struggling to climb above the $200 billion mark. Only two cryptocurrencies are now above $200 billion in market cap, and they are Bitcoin and Ethereum. While Bitcoin's market cap is $2.2 trillion, Ethereum is at $552 billion, according to ETH data from CoinGecko. XRP is less than one-third of Ethereum's market cap and has a long way to go to achieve the feat.
