Tether (USDT) surpassed ripple (XRP) and became the third largest cryptocurrency in market capitalization. Despite the controversies surrounding the asset in the recent past, the asset has been increasingly gaining ground with the retail investor, either to maintain a position in dollar, or to trade with other cryptocurrency pairs.
The reasons are more linked to the drop of ripple use than in the rise of the tether dollar. While ripple saw its market value fall from US$ 130 billion in January 2018 to US$ 9 billion recently, the tether dollar made a journey from US$ 1.3 billion that same month to the current US$ 9.1 billion. However, ripple’s market value fall is closely linked to the cryptocurrency’s price, while the rise of the tether has to do with its adoption.
To get an idea, XRP competed for the second position with ether (ETH); however, currently, the combined market value of XRP and USDT is still US$ 5 billion behind the second cryptocurrency in market capitalization.
XRP Ripple struggling to pull retail investors
According to an article published in Cointelegraph, perhaps part of the problem of XRP is the lack of traction with retail investors. To get an idea, in terms of daily trading volume, USDT outperforms XRP by 25 times.
But according to the matter, the dispute for third place is not over. A possible bull run could represent a further reversal of places in the dispute, as Ripple’s fall is linked to the cryptocurrency’s share price
Ripple was created to be a global payment cryptocurrency for serving financial institutions. In this scenario, its advantages over bitcoin are based on increased scalability and lower transaction costs, since cryptocurrency does not have a reward system like the leading cryptocurrency. RippleNet customers can use XRP to get liquidity in international transactions, rather than using pre-financing, ensuring instant settlement, lower exchange rates, and more efficient use of working capital.