Ripple (XRP) has been eagerly trying to distance itself from its XRP token for the past few weeks. While investors have long complained about Ripple ignoring its XRP token and not doing enough to bolster its future prospects, this time the company has taken a more aggressive approach to formally distance itself from its uncertain token, XRP. In other words, Ripple is turning its back on a token that is responsible for the company’s current stature and market valuation of over $24 Billion, based on the XRP tokens alone! Ripple’s director of regulatory relations, Ryan Zagone recently stated that there is no direct connection between Ripple (the company) and XRP.
This statement came as a shock to most Ripple (XRP) believers who strongly feel that XRP is the reason Ripple is a billion dollars company today and it would not have been possible without these loyal investors. Ripple just came up with a new logo for XRP as well as a separate twitter account. The reasoning behind this according to the company, is to give XRP its own identity and a logo that denotes a sign so as to be used as a currency symbol just like $ for the US Dollar.
So, why is Ripple distancing itself from XRP? The reasons are pretty straightforward. The main reason Ripple is so keen to distance itself from its token is the risk of XRP being classified as a security by the SEC. Recent developments brought this to attention so Ripple decided to address this preemptively before it becomes a problem for Ripple (the company). As we know, Ripple does not have a good track record of winning legal cases or receiving any help from exchanges or government organizations. So, if an event like this does happen, XRP will probably be delisted on most exchanges and Ripple does not want to be associated with XRP if and when that happens.
Another plausible reason why Ripple is distancing itself from XRP has to do with the inherent value of XRP. For long, Ripple has used its XRP token as a bait to lure in investors but the real purpose of XRP is unclear so far. Despite Ripple’s repeated announcements that it will do more to convince financial institutions to use the XRP token for liquidity sourcing, no breakthrough has been made so far. Having said that, Ripple will not give up on XRP altogether. In fact, it will continue to project XRP as a useful token, one central to its activities, so that it may continue to attract more investors.
Ripple has mentioned in the past that XRP will continue to exist whether Ripple (the company) exists or not. It would have been possible for XRP to become an independent currency like Bitcoin (BTC) to be used for payments given its high speed and low fees, but the fact that Ripple still holds 55 Billion XRP will continue to remain a major impediment for any financial institution to use XRP even if it wants to. XRP currently trades at $0.61 with room for limited downside. The price looks bullish long term and a lot of retail investors are eager to buy at these levels. However, for institutional investors, Ripple (XRP) is not the best of investments right now given the risks.