Ripple is a Utility Token, Says European Governance Institute — XRP Price In A Major Downtrend
XRP is a utility token according to European Governance Institute, but price keeps declining.
Key Takeaways
- ECGI confirms XRP as a utility token, not a security.
- XRP price sees downtrend, potential for recovery explored.
- XRP could potentially retest $1 with bullish momentum.
The XRP community is excited about a new development that bodes well for the token’s future. A recent study by the European Corporate Governance Institute (ECGI) has confirmed XRP as a utility token. This aligns with a US federal court’s decision in July last year.
Meanwhile, the price of XRP has been in a 24% downtrend since its last high of $0.75, made on March 11. It dipped below $0.60 yesterday, March 19, but can it recover soon?
XRP Is A Utility Token?
This clarification of XRP’s status comes from a research paper entitled “Corporate Governance Meets Data and Technology,” which examines new fundraising methods in the blockchain industry. These include Initial Coin Offerings (ICOs) and Security Token Offerings (STOs). The paper, authored by Wei Jiang from Emory University and Tao Li from the University of Florida, addresses the complex regulatory environment for cryptocurrencies.
SEC chairman Gary Gensler’s stance that most cryptocurrencies, including XRP, are securities. Despite that a federal judge ruled otherwise for XRP transactions on public exchanges in July. The ECGI’s support reinforces the view of XRP as a crucial component of Ripple Payments, facilitating fast and affordable cross-border payments that could potentially lead to widespread adoption by banks and financial institutions.
Ripple (XRP) Price Analysis
The price of Ripple (XRP) started its last uptrend on February 6 after bouncing from its $0.50 support. It broke above the descending resistance and anchored at its last major high of nearly $1 in mid-July 2023, signaling a potential start of a bull cycle.
We saw a five-wave pattern typical for impulsive price movements, ending at a $0.65 high on March 11, followed by this last downtrend to its 0.618 Fibonacci retracement. This is a typical ending point for corrective waves and could be a higher degree correction to a larger bull cycle.
If true, XRP should find support here and increase again with more strength. According to this count, a higher degree wave three should start developing. If that happens, XRP could potentially embark on a journey to $1 again, where its 1.618 Fibonacci extension level is projected.
But first, we need to see some bullish price movement, as XRP is still in a downtrend. Until that happens, the price could further continue declining, with its next target being $0.55.
Disclaimers
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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