Cryptocurrency investors remain hopeful for XRP’s future, yet its fate is far from certain. A positive resolution of Ripple’s dispute with the SEC would likely bolster investor enthusiasm but will entail inherent risks that must be carefully managed.
Cross-quantilogram heatmaps reveal evidence of weak negative predictability between other cryptocurrencies and BTC in the low and middle quantiles, under normal cryptocurrency market conditions, which suggests potential vulnerability for contagion or risk transmission within this sector of the market.
Price Predictions
On 13 July, crypto investors took a deep sigh of relief as the judge in the Ripple securities case decided that XRP did not qualify as a security. This news sent shockwaves through the industry; many coins experienced an impressive surge.
Although Bitcoin Cash’s price has seen significant decrease, its long-term future remains optimistic. BCH boasts partnerships in banking services and can greatly enhance global remittance services; therefore many consider investing in BCH a worthwhile endeavor.
However, there are those who remain pessimistic on Bitcoin Cash’s future – for instance, Wallet Investor predicts its price will decline to $17 within one year – an optimistic prediction. Gov Capital believes BCH to be an ineffective long-term investment and expects it to drop below the $600 threshold by 2024. Regardless of these predictions from bearish analysts, most analysts remain bullish on its price growth; many point to rising ETF interest and approval by SEC as potential reasons behind BCH price appreciation.
Volume Predictions
The cryptocurrency market has experienced an extraordinary surge in growth this year. Led by Bitcoin, but other coins also witnessed gains. Investors are drawn to these unique offerings that offer unique advantages – for instance, IOTA stores sensor messages; Ethereum stores software code; and XRP facilitates international banking transactions.
Cryptocurrencies offer investors who seek independence from centralized financial institutions another viable investment alternative, as they resist government regulation and offer greater transparency. But these advantages do not come without risks – several studies have investigated risk transfer between cryptocurrencies and traditional markets.
As illustrated by the graph below, cryptocurrencies demonstrate strong correlations with volatility indices, with cryptocurrency prices responding strongly to changes in these indices. Cryptocurrencies seem less closely correlated with stocks and crude oil than is sometimes assumed; additionally, correlations often dissipate quickly so it remains uncertain whether cryptocurrency returns are connected with volatility within traditional markets.
Graph Analysis
Cryptocurrencies have displayed bearish tendencies recently and could experience further losses in the near future. Bitcoin cash price has formed a critical bearish trendline with resistance at $1,220 that could see further decreases towards $1,050 support should it fail to remain above said trend line.
During the COVID-19 period, Bitcoin had more of a correlation to ETH and XRP than to Litecoin and Ethereum; however, pairs like ETH-XRP or ETH-XMR had stronger negative correlations to BTC than any other pair did.
Contrary to its counterpart, the address graph does not involve transactions but instead only creates edges between input and output addresses. Furthermore, unlike its transaction-graph counterpart, it does not lose information regarding past address reuse (e.g. edge from 3 to 1) or change address reuse (edge from 6 to 7). Therefore, the address graph contains more edges than its transaction-graph counterpart, making it easier to identify real entities behind addresses while being more resilient against path-based attacks.
Forecasting
Cryptocurrencies are digital assets used for financial transactions between addresses. Blockchain platforms store these transactions along with software code stored as smart contracts.
Ripple bills itself as a global payments network for banks and financial institutions, offering its native currency of XRP as payment. Ripple aims to solve the challenge of high-volume, low-value international money transfers that are both expensive and time consuming for larger financial institutions.
Ripple uses a consensus mechanism between bank-owned servers to validate transactions, unlike Bitcoin which relies on blockchain mining for confirmations. This allows Ripple to process transfers quickly with lower transaction costs.
Ripple creates one RippleState object per currency pair to connect two accounts, and identify which account is low/high by recording their trust line limits in an offer document. Future transactions use these offers to transfer currency between accounts.
