Ripple's former director of developer relations, Matt Hamilton, has dispelled another popular misconception surrounding XRP. This time it was talk and speculation that XRP could be backed by gold. This kind of talk has emerged relatively recently amid speculation that XRP could be accepted by the world's banks and other financial institutions for international settlements and would be backed by gold for its fair value.
No gold for XRP
Hamilton is adamant that such an outcome is impossible. The blockchain developer explains his view that XRP is a decentralized cryptocurrency with finite supply, which trades on the open market and has no issuer to hold collateral for gold. For this reason, Hamilton explains, XRP cannot be inflated to have a peg with another asset.
The only contact between gold and XRP is possible through its tokenization via XRP Ledger, with the creation of a token tracking the precious metal's quotes, concluded the developer. For those who do not believe it and still think otherwise, Hamilton offered to exchange one ounce of gold for one XRP.
You can track gold by tokenising it on the XRP Ledger and creating a token such as XAU like companies have been doing for the past decade. But you can't back XRP itself with gold.
— Matt Hamilton (@HammerToe) February 26, 2023
Previously, the former Ripple director, now a contributor to the Filecoin (FIL) ecosystem, also debunked rumors of a government buyout of the XRP offering. This theory was also extremely popular among the community and suggested that XRP would be bought back by the U.S. government at prices rumored to be as high as $10,000 per token.
FAQs
No gold for XRP
Can XRP be backed by gold? ›
Is it Backed by Gold? In terms of Ripple, XRP is not backed by gold. Although there have been digital assets backed by the metal, XRP has never been one of those.
What is XRP backed by? ›
Unlike most cryptocurrencies, which are decentralised and therefore not run by a single entity, the cryptocurrency XRP is controlled by a company called Ripple.
How safe is Ripple XRP? ›
How safe is XRP? Like any investment, XRP comes with its own unique set of risks. But investing in any cryptocurrency is extremely high risk and one should not expect to be protected. XRP is underpinned by blockchain technology, which ensures secure, fast and cost-efficient transactions.
Why is there a lawsuit against XRP? ›
The United States Securities & Exchange Commission (SEC) accused Ripple and its executives of raising more than $1.3 billion through an unregistered asset offering of the XRP token.
What happens if XRP is found to be a security? ›
XRP trading would be more complicated if the coins were found to be securities, Ripple's lawyers said — and sellers might even face individual liability for trading unregistered securities. It would also be harder, according to Ripple, for businesses to accept and make payments using XRP if the tokens are securities.
Will XRP ever be used by banks? ›
The Ripple ecosystem was designed to enhance cross-border financial transactions by banks and financial institutions. Ripple uses XRP (internationally) in its Ripple Payment solutions as a bridge currency.
Is XRP a dead coin? ›
Regardless of the bearish certainties, many analysts continue to remain bullish on XRP and believe it to be a good time to stack XRP. The recent SEC update has boosted optimism around the token.
What will XRP be worth after a lawsuit? ›
Since the lawsuit concluded, a Ripple XRP price prediction is going to be challenging to say the least. In 2025, there are some who are now calling for $2, while at the same time there are people suggesting that $5 is more likely.
Does XRP have a future? ›
However, based on historical performance and market trends, it's possible that XRP could experience growth over the next few years. Keep an eye on the news surrounding Ripple in regard to the SEC case and its ongoing developments.
David Cox, writing on the CryptoNewZ platform, anticipated that XRP could reach a high of of $1.53 by 2025, with a low of $1.06 for the same year. Another Ripple price forecast by AMBCrypto estimated the XRP price could hit a high of $2.01 in 2030, with a short term prediction of a high of $0.61 in 2024.
Can XRP reach $100? ›
Crypto analyst JackTheRippler has raised the possibility of the XRP price rising to $100 soon enough. As part of his prediction, he mentioned what needs to happen for the crypto token to attain such ambitious heights.
Should I take my money out of XRP? ›
Deciding when to sell Ripple depends on your individual financial goals, risk tolerance and market conditions. Consider factors like price trends, your investment timeline and potential tax implications.
Who won the XRP lawsuit? ›
The SEC accused Ripple of selling XRP in an unregistered security offering. The outcome of the U.S. regulator's court case against Ripple might still have far-reaching consequences for the cryptocurrency industry. Both the SEC and Ripple emerged somewhat victorious in this court case.
When should the XRP lawsuit be over? ›
Experts are predicting a potential end date for the lawsuit at the district court level by July or August 2024. This means a ruling on the core issue could be issued soon. This timeframe provides some much-needed relief for investors who have been anxiously waiting for a resolution.
Why is XRP blocked? ›
The exchange stopped offering the token in New York due to a legal battle over XRP's status as a security.
Could XRP become a reserve currency? ›
Michel highlighted XRP's unique ability to provide liquidity for foreign exchange reserves, international transactions, investments, and various global economic applications. This versatility positions XRP as an ideal candidate for a world reserve currency.
Which crypto is backed by gold? ›
AurusGOLD (AWG) is a gold-backed cryptocurrency managed by a network of players from the traditional gold market. Each AWG token is 100% backed by gold, making it a reliable store of value. It is collateralized by 1 gram of 99.99% LBMA standard gold, securely stored in fully audited and insured vaults.
Will XRP become a stablecoin? ›
Early April Ripple announced its plan to launch a stablecoin for the XRP Ledger ecosystem, initially pegged to the US dollar, offering stability and predictability compared to the often volatile cryptocurrency market.
Is XRP backed by silver? ›
It is unlikely for XRP to become a new global standard backed by silver, gold, or precious metals due to current ongoing lawsuit. The lawsuit and its outcome may greatly impact XRP's future and adoption.
