Update: Ripple (XRP) Dear Reader, Today, we’re updating you on a situation regarding one of our long-time crypto holdings, Ripple (XRP). We originally recommended the token in December 2017. Ripple is a settlement system, currency exchange, and remittance network. It aims to be the global leader in payment processing by making transactions cheaper, faster, and more secure by using blockchain technology. On Tuesday, the Securities and Exchange Commission (SEC) sued Ripple Labs (the company behind the Ripple payment network), its co-founder Christian Larsen, and CEO Bradley Garlinghouse. Essentially, the SEC says Ripple should be treated as a security, not a cryptocurrency, and therefore its executives violated securities laws regarding disclosure of information. Although Ripple’s executives are disputing the SEC’s claim, the lawsuit is already affecting Ripple. On Wednesday, Bitwise Asset Management, a leading crypto fund manager, announced it liquidated its entire position in XRP, which made up almost 4% of its fund. And Ripple’s price has plunged more than 50% as a result, dropping to about 27 cents at time of writing. While it’s unfortunate the SEC is targeting Ripple, and it’s sure to impact the price in the near term, we feel confident this lawsuit won’t hurt it in the long run. Here’s why… First, Ripple has the money to hire the best lawyers in the world and go toe-to-toe with the SEC. It even hired former SEC chairwoman Mary Jo White as its representative back in 2018 in a separate case. Plus, we don’t think the SEC’s case holds water. XRP is now more of a utility token than ever because it’s used on Ripple’s on-demand liquidity (ODL) network. And if you acknowledge XRP as a utility token for network usage, it’s harder to classify it as a security. And I’m still excited about Ripple’s potential. Over 350 financial institutions use its payment network, RippleNet, to receive payouts in more than 40 currencies across 55-plus countries. These RippleNet members can settle transactions in three to five seconds, compared to the days it could take traditional services. Also, as you recall, XRP holders just took part in the Flare Network token airdrop. The network allows XRP to become interoperable on ecosystems outside of Ripple. This gives it more use cases in transferring value across borders. We believe Ripple will recover from this blow and demand for its services will continue to drive the project forward. So we’ll continue to hold Ripple in our portfolio. However, this lawsuit could seriously affect Ripple in the short term. XRP’s price could continue to fall, as there’s no guarantee how long it might take to play out. Note: The lawsuit is also having a chilling effect on so-called altcoins. Ethereum and many Ethereum-based projects are down on fears of an SEC clampdown. Our belief is these fear-based sell-offs should be viewed as a buying opportunity. That’s the way we treated government-induced sell-offs in bitcoin, and time has proven us right, as bitcoin has gained near-universal acceptance by both governmental and regulatory bodies. | That’s why we’re giving you the full picture of what’s happening with Ripple today. And we want to advise you if you choose to continue to hold XRP, you must be prepared to stomach further volatility. If not, you should do what falls within your own risk tolerance. This is a good reminder of just how young of an asset crypto is. So we should expect to see these bumps in the road once in a while. We aim to hold these coins for a long time to reach the biggest gains. But we also fully understand not all of our positions will be winners. That’s why we always advise using appropriate position sizing ($200–400 for smaller investors or $500–1,000 for larger investors) to limit your downside risk without giving up the chance at asymmetric gains. We’ll continue to watch the effects of this lawsuit play out and let you know of any material news regarding Ripple. For now, we will list it as a hold in our portfolio. Action to Take: If it fits within your risk tolerance, hold Ripple (XRP). Let the Game Come to You! Big T P.S. Enjoy your holiday. Don’t let this volatility steal away any of your peace of mind. So long as you are position-sized properly, you can safely ignore the day-to-day gyrations of the crypto market. Remember to stay focused on the big picture of widespread adoption of crypto assets. The megatrend of crypto adoption married with time and proper position-sizing will do all the heavy lifting for you. So go enjoy your time with your family! NEW: Mobile Notifications Palm Beach Research Group now has a smartphone app. You can use it to get instant notifications whenever we publish something new, access all your subscriptions, view portfolio pages, and more. To make sure you don’t miss any time-sensitive alerts, updates, or monthly issues, download the new Palm Beach Research Group app for Android or iOS. This feature is available for international and U.S. subscribers and aims to send alerts instantaneously to all members. Make sure push notifications are enabled through your phone settings to receive alerts from the app. Important note about emails and text messages: We strive to deliver all of our alerts as quickly as possible. Due to the nature of email, SMS, and app notifications, we aren’t able to guarantee each user will receive our communications at exactly the same time. Deliverability depends on your location, your internet service provider, and internet traffic, among other variables. | | 
No comments:
Post a Comment