Will Ripple’s Price Decline as It Faces Competition From Established Players Like Mastercard?

Ripple is a cryptocurrency payment system created by Ripple Labs. The native token of Ripple is XRP (CRYPTO: XRP), which was built to facilitate global payments. Basically, Ripple aims to replace the traditional banking system by allowing users to transfer money at a low cost.

Founded in 2012, Ripple Labs also developed the XRP Ledger 10 years ago. The XRP Ledger is a peer-to-peer network of nodes, an open-source, decentralized ledger.

While the cryptocurrency segment has delivered exponential returns to investors in the last two years, XRP has trailed the market in this period. Ripple is in the midst of a case with the U.S. Securities and Exchange Commission. The SEC alleges Ripple’s management team carried out an unregistered offering amounting to US$1.3 billion via the distribution of the XRP token.

In addition to the ongoing lawsuit, XRP and Ripple will also have to withstand competition from legacy players such as Mastercard (NYSE: MA). Let’s see how.

Mastercard announces partnership with bitsCrunch and other blockchain companies

At the start of the last decade, cryptocurrencies were viewed as a speculative asset class. But in the last two years, the widespread adoption of Bitcoin and other blockchain-powered networks as well as the rise of non-fungible tokens and DeFi projects have pushed cryptocurrencies into mainstream territory.

Europe is a key region that is driving innovation in the cryptocurrency space. It received over US$1 trillion worth of cryptocurrency in the 12-months prior to July 2021, accounting for 25% of global crypto activity.

In order to accelerate the benefits of crypto in Europe, two companies — bitsCrunch and SPENN Technology — have joined Start Path Crypto, which is Mastercard’s blockchain-focused start-up engagement program. Mastercard provides partnership opportunities, insights, and tools to these companies as part of the Start Path Crypto program.

BitsCrunch, a blockchain analytics company, was founded in 2020 and pivoted to non-fungible tokens in 2021 after it recognized the need to “better protect the ecosystem and ensure secure and reliable trades.”

In addition to creating an ecosystem where start-ups can thrive, Mastercard has widened its portfolio of products over the years. For instance, several Mastercard users were using cards to purchase crypto assets. It also saw users take advantage of crypto cards to access digital assets and convert them to fiat currencies.

In order to take advantage of a rapidly expanding market, Mastercard recently announced it will support a few cryptocurrencies on its network.

Why do you need to remain bullish on cryptocurrencies?

The first Bitcoin was mined 14 years back. While Bitcoin has generated staggering gains for long-term investors, there are more than 17,000 cryptocurrencies in circulation right now. A few of these digital assets have the potential to disrupt legacy banking and payments systems making them extremely valuable.

The total number of crypto users has almost tripled to 295 million in 2021 and this figure might touch one billion by the end of this year. Further, the market size of blockchain businesses that power tokens and coins is forecast to grow from US$5 billion in 2021 to US$228 billion by 2028.

We can see why established companies such as Mastercard are entering the cryptocurrency market, despite the volatility and lack of regulations associated with this segment.