What you need to know about XRP's path to $ 2

Compared to "artists" of the caliber of Polkadot, Cardano and Ethereum, the usefulness of XRP has always been undermined. The token, however, has gained traction in recent times, thanks to its 56,4% weekly increase.

The different use cases of XRP

As of now, XRP is being used by a number of companies for various purposes. Ripple uses it for cross-border remittances, Coil for micropayments, Blockchain Capital for capital calls, SB Projects for entertainment monetization, and XRP Tip Boot for tips on platforms like Twitter and Reddit.

Additionally, banks and other financial institutions use XRP via RippleNet ODLs. In fact, the San Francisco-based blockchain company has struck deals with new partners recently. Also, as the ongoing lawsuit against the SEC ends, with greater regulatory clarity, the number of partnerships will eventually increase. In retrospect, the same has the potential to justify the evaluation of XRP.

Interestingly, the Ripple network also supports the launch and livelihood of stablecoins and CBDCs. The aforementioned use cases of XRP are somewhat less known.

In general, the price of a given asset is the result of two key factors: its utility value and its speculative value. As for the utility aspect, the XRP fared pretty well, but what about its speculative value?

What the metrics say

The average coin age of XRP was at its ATH level (1001 days) at the time of writing. Therefore, this metric represents the average number of days that all XRP tokens have remained in their current addresses. It witnessed a slight deviation during the beginning of August but was able to deny the same with its current uptrend. The increase in average age indicates the fact that most HODLers are accumulating XRP at this stage.

Coin dormancy also showed a similar trend. The Dormant Circulation, in fact, shows the number of unique tokens traded on a given day that have not been moved for a long enough period of time. Now, as per the attached chart below, the 180-day dormant circulation witnessed a huge spike during the end of July and the token price felt the pinch in parallel. The same, however, has remained at the bottom since the beginning of August. This, on the whole, again supports the narrative of accumulation.

XRP's stock-to-flow ratio, however, has remained down since June. The S2F model helps decipher how much supply enters the market each year, compared to its total supply. Ergo, the higher the ratio, the lower the supply that enters the market. However, looking at the current state of this indicator, it can be said that it would be quite difficult for XRP to hold its value over the long term.

Amid the brouhaha about the recent price hike, it should be noted that XRP's path from here to the $ 2 benchmark won't be that easy. The token has a number of resistance levels to overcome before its valuation actually swells. XRP had a quotation of $ 1,25 at the time of this writing.