When you buy XRP, or as others may call it, go long on XRP, it means you’re investing in the Ripple cryptocurrency with the expectation that its price will rise. With Skilling, you can buy or go long on XRP through Contracts for Difference (CFDs), which are financial instruments that allow you to speculate on the price movements of XRP without actually owning the digital currency. This means you could potentially profit from both rising and falling markets.
Using CFDs also gives you the opportunity to trade with leverage, which means you can open a larger position in the market by only putting down a small amount of the total value as a deposit. However, it's important to remember that while leverage could increase your gains if the market moves in your favor, it could also magnify your losses if the market moves against you.
Why consider buying XRP?
XRP's use in cross-border payments
XRP is designed for fast and cost-effective cross-border payments. It's part of the Ripple network, a system used by banks and financial services to transfer money across different countries quickly and with lower fees compared to traditional banking systems. This practical use case suggests that XRP has a strong foundation for long-term utility, as there's a continuous need for improved international money transfer solutions.
Ripple's recent legal challenges
Ripple Labs, the US-based technology company behind the Ripple payment protocol, recently settled a significant lawsuit with the US Securities and Exchange Commission (SEC). On August 7, 2024, they were fined $125 million after four years of litigation. This settlement might bring some stability to Ripple's operations and could affect XRP's future positively by clearing up legal uncertainties that have long surrounded it.
Potential Ripple IPO
There's speculation that Ripple might go public through an Initial Public Offering (IPO). Going public could inject additional funds and credibility into Ripple, potentially boosting XRP's profile if the company's market debut is successful. An IPO would also mean more transparency and possibly increased investor confidence in Ripple and, by extension, in XRP.
Possibility of an XRP ETF
Like Bitcoin ETFs and Ethereum ETFs, which allow investors to get involved in these cryptocurrencies through traditional investment channels, there's ongoing speculation about whether there will be an XRP ETF. An ETF for XRP would provide a way for investors to invest in XRP through stock exchanges without directly dealing with the cryptocurrency, broadening its appeal and accessibility.
How to buy XRP CFDs with Skilling
1. Create an account with Skilling: Visit Skilling and sign up for an account. You will need to provide personal details and complete the identity verification process to ensure compliance with financial regulations.
2. Deposit funds: Once your account is verified, deposit funds using your preferred method. Skilling supports various payment options like credit cards, bank transfers, and e-wallets.
3. Navigate to the trading platform: Log in to your Skilling account and access the trading platform. Familiarize yourself with the interface.
4. Find XRP CFDs: Use the search function on the platform to locate XRP CFDs. You can typically find it by entering ‘XRP’ or ‘Ripple’ in the search bar.
5. Analyze the market: Before you make a trade, review the current market conditions for XRP. Check the latest news, technical indicators, and any other relevant information that might impact XRP’s price.
6. Set up your trade: Decide the amount of XRP you want to trade. Set your order type:
- Market order: Buys XRP at the current market price.
- Limit order: Sets a specific price at which you want to buy XRP.
Implement risk management tools:
- Stop-loss order: Establishes a price at which your position will automatically close to prevent further losses.
- Take profit order: Sets a target price at which your position will close to lock in profits.
7. Execute the trade: Once you have set up all parameters, confirm and execute your trade. Your XRP CFD position will now be open.
8. Monitor your position: Keep an eye on the market and how XRP’s price is moving. Adjust your positions as necessary.
9. Close your position: When you’re ready to close your position, or if your stop-loss/take-profit levels are reached, you can close the trade to realize your profit or loss.
10. Withdraw funds: If you’ve made a profit and wish to withdraw, go to the withdrawal section of your account, select your preferred withdrawal method, and follow the instructions to transfer your funds.
Long-term vs. Short-term investment in XRP
Investing in XRP, like any cryptocurrency, can be approached in two primary ways: long-term holding and short-term trading. Each strategy has its pros and cons, depending on your investment goals, risk tolerance, and market understanding.
Long-term investment in XRP
| Pros | Cons |
|---|---|
| Potential growth: If you believe in the future of digital currencies for global transactions, holding XRP long-term could be beneficial. XRP is designed to facilitate fast and cost-effective international payments, and increased adoption by financial institutions could lead to price appreciation. | Regulatory risk: The legal landscape for cryptocurrencies is still evolving. Regulatory decisions or changes in laws can significantly impact the market. |
| Less time-consuming: Long-term investing doesn’t require daily monitoring of market fluctuations, which can be less stressful and time-consuming than short-term trading. | Market uncertainty: The future of cryptocurrencies, including XRP, is promising but uncertain. Technological changes or shifts in market dynamics could impact long-term viability. |
| Avoid short-term volatility: Cryptocurrencies can be highly volatile. By holding onto XRP for the long term, you may avoid the stress of short-term dips in value. | Liquidity concerns: Depending on market conditions, you might find it challenging to sell large amounts of XRP quickly without affecting the price. |
Capitalise on volatility in cryptocurrency markets
Take a position on moving cryptocurrency prices. Never miss an opportunity.
Short-term trading of XRP
| Pros | Cons |
|---|---|
| Capitalizing on volatility: The price of XRP can fluctuate widely within short periods, offering opportunities to gain from buying low and selling high. | High risk: Short-term trading requires understanding market trends and being able to react quickly. The high volatility of cryptocurrencies could lead to significant losses. |
| Quick returns: Unlike long-term investments, trading allows you to realize gains within a shorter timeframe, potentially growing your investment capital faster. | Time-intensive: This approach requires constant market analysis and a good grasp of trading strategies. It can be very time-consuming and is more like a full-time job. |
| Leverage opportunities: Many platforms allow traders to use leverage, magnifying the potential returns (though this also increases potential losses). | Transaction costs: Frequent trading can incur substantial fees, which can eat into your gains. Every trade has a cost, and these can accumulate, particularly with high volumes. |
Comparing XRP with other cryptocurrencies
XRP price hasn't moved that much over the years, it's only up 3% in the past one year. This is most likely due to its lawsuit. Bitcoin, on the other hand, is up 110.44% in the past year, while Ethereum has risen by 43.96% in the past one year. XRP’s legal challenges have dampened its market momentum, unlike Bitcoin and Ethereum, which have benefited from broader acceptance and integration into financial systems. While Bitcoin is seen as digital gold and Ethereum powers decentralized applications, XRP's future potential hinges significantly on the resolution of its legal issues and subsequent adoption for cross-border payments.
What better way to welcome you than with a bonus?
Start trading with a $30 bonus on your first deposit.
Terms and Conditions apply
Conclusion
Now that you've learned how to buy XRP through CFDs with Skilling, it's important to always prioritize risk management. Trading cryptocurrencies like XRP involves significant volatility and potential risks. Utilize tools such as stop-loss and take-profit orders to manage and mitigate potential losses effectively. Remember, the crypto market operates 24/7, leading to rapid price changes. Always stay informed about the latest market developments and adjust your strategies accordingly. Source: investopedia.com
