CEO Ripple, Brad Garlinghouse, recently claimed that bitcoin’s impact over other altcoins is losing its strength. He said that although bitcoin always had a significant influence on other digital currencies, yet it is not as impressive as it used to be. In the long run, markets have been able to distinguish between the various assets available in the crypto space.
He said, “There’s a very high correlation between the price of XRP and the price of bitcoin, but ultimately these are independent open-sourced technologies. It’s early, over time you’ll see a more rational market and behaviors that reflect that.”
Ripple is a popular financial payments company based in San Francisco trading in the name of XRP which be used or faster digital transactions. Garlinghouse informed that his company made a personal record in the first quarter itself by signing production contracts with 20 new firms. The company also announced its partnership with Kuwait’s largest bank this Wednesday. Moreover, companies like MoneyGram are currently working on XRP’s capability in cross-border payments.
However, XRP faced hard times as it was the worst performing high caliber digital currency as it lost 70 percent of its value. It should be noted that the first quarter of 2018 saw a 50 percent dip in the market capitalization of virtual coins. Bitcoin paid the price by a 50 percent decrease in its value.
Garlinghouse added, “It’s still a nascent industry, the speculation in the market dominates the trading activity. I think it’s a matter of time until people better understand the different use cases.” As of now, the crypto space is bombarded with 1500 virtual coins, but experts predict that only 1 percent of the bunch survive in the coming ten years. He added that most of the virtual currencies do not solve any real-world problem and will eventually get lost in time.
On the more serious note, not only many virtual coins are of no use they have been allegedly duping investors of money through Ponzi schemes and unprecedented ICOs. The Securities and Exchange Commission has been on its toes to regulate such activities, and it has already shut many projects including one supported by DJ Khalid and Floyd Mayweather.
Garlinghouse backed SEC’s decision to tame the crypto space due to multiple incidents of fraud. He requested the government to keep the area clear of unethical ventures but also informed that few projects do hold real utility.
The agency has been under pressure to specify digital currencies’ role as people have been calling it a security. Jay Clayton, Chairman SEC, stated in March that ICOs are a part of securities. On the other hand, Ripple does not want to get included in the group as he believes that XRP, just like stocks, and classic securities are very different. He concluded, “If you own XRP, you don’t own rights to the profits or any dividends to the company. XRP has real utility.”
We would have to wait until we see a drastic change in the goodwill of bitcoin over other digital currencies.
