The cause of stagnation XRP price augment remains a mystery, and many cryptocurrency analysts point to legal disputes and market volatility as key factors inhibiting its dynamics. However, even in favorable market conditions and after legal clarity has been achieved through repeated amendments Ripple Court wins v. U.S. Securities and Exchange Commission (SEC), XRP still has has not experienced any noticeable growth.

As a result, investors are questioning the cryptocurrency’s tardy price growth, prompting a cryptocurrency analyst to provide a detailed explanation as to why XRP has remained at low levels, barely showing signs of possible growth.

Why the XRP price is struggling to gain momentum

On October 13, the cryptocurrency analyst and researcher known as “Crypto Tank” sat down with X (formerly Twitter) to discuss why The price of XRP does not change. In the long one Post XThe analyst explained that XRP price was determined by dividing the volume of XRP actively used on the ledger by its circulating supply.

According to Crypto Tank, XRP investors have a misconception that the total amount of XRP in circulation is around 56 billion. However, this number is misleading because a huge portion of the XRP supply is held in various private wallets by huge holders, also called “Whales” This means that most of the XRP supply is not actively used in the market, but is firmly held in these wallets.

The analyst revealed that this is what really matters XRP price movements is the amount of circulating supply used to actively engage in transactions on the XRP ledger. Currently, only about 20% of the total XRP supply is actively used on the XRP ledger on a daily basis.

In order for XRP to be used to complete transactions, it often needs to be paired Automated Market Makers (AMM)that ensure liquidity during transactions. These liquidity pools are significant for XRP for global settlementsbecause only sufficient liquidity can facilitate these huge transactions worth trillions of dollars. This demand for significant liquidity in XRP Ledger is what limits price movements.

The analyst’s report makes it clear that yes XRP Price Fights are more complicated than straightforward market volatility. The ongoing legal dispute with the SEC also increases uncertainty about potential price increases in the future.

Analyst presents roadmap for XRP to $500

While discussing the reasons XRP price remains stagnant, and so does the Crypto Tank exposed a roadmap on how XRP can reach $500. Analyst explains that if XRP could become widely adopted for global settlements like SWIFT, it could potentially meet this target price.

He revealed that the augment in market capitalization or the growth of retail investors does not matter because XRP will only rise to the projected price of $500 if it is able to support huge institutional transactions through deep liquidity pools and AMMs.

Featured image created with Dall.E, chart from Tradingview.com