Cryptocurrency
Is the Ripple (XRP) Price in Major Danger? 4 Factors to Consider
TL;DR
- Ripple’s XRP has dropped 10% in two weeks, with declining transaction activity and a broader market downturn suggesting that its correction may continue.
- The ongoing Ripple v. SEC lawsuit could introduce more volatility for XRP, with recent legal developments sparking speculation of a potential appeal by the regulator.
XRP to Bleed Even More?
The past two weeks have been unpleasant for Ripple’s XRP, whose price tumbled by 10% and is currently trading at around $0.53 (per CoinGecko’s data).
While XRP bulls eagerly await a renewed price revival, some crucial factors hint that the correction might be far from over. The first element is the broader decline of the entire cryptocurrency market, where Bitcoin (BTC) slipped below $56,000. It will be interesting to see whether the sector recovers some of the losses incurred in the following days and whether XRP could head north, too.
The second factor is the number of XRP payments from one account to another. Data shows that the figure has fallen from almost 570,000 on September 1 to 370,000 as of today (September 6). This indicates decreased processing activity and could be a sign of reduced engagement within the ecosystem.
For its part, the number of active XRP accounts is down 65% on a five-day scale, reinforcing the aforementioned worrying thesis.
Last but not least, we will touch upon the number of transactions that have been executed. The figure spiked above 1.5 million at the start of September, only to plummet below 850,000 on September 6. This decline could reflect a change in market sentiment, with some investors losing confidence in XRP, thus triggering a further negative impact on the price.
The Ripple v. SEC Case
The ongoing lawsuit between the two entities may also propel enhanced volatility for XRP in the near future. The legal battle reached a major milestone last month when Judge Torres ruled that Ripple must pay a $125 million fine for violating certain securities laws.
The sum represents a 94% deduction on the SEC’s initial request, which caused many industry participants to declare the decision a major win for the company. XRP’s price reacted positively, soaring by double digits shortly after the announcement.
Earlier this week, Ripple filed a motion requesting a stay on the monetary portion of the Court’s Judgment entered in August. The firm’s lawyers revealed that the regulator agreed with the proposed terms and delay of the payment (which was due on September 6).
Some X users assumed that this move could be a precursor of a potential appeal by the SEC, which might not be pleased with the initial ruling. The American attorney Fred Rispoli, for instance, said:
“Going through all this effort with establishing a trust for the funds boosts chances of an appeal IMO. But ultimately, this is just the safest play for SEC to buy time until the Oct. 7 deadline to appeal.”
It will be interesting to follow the news surrounding the case and check if they will have some impact on XRP’s valuation.
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XRP seems to have found support around 50 cents. Can buyers push the price higher this week?
Key Support levels: $0.50
Key Resistance levels: $0.54, $0.68
1. Price Finds Support
After a sharp fall last week, bulls appear to be back. XRP opened this Monday in green and is keen to return on an uptrend. As long as the key support at 50 cents holds, buyers have a good chance to return on the offensive.
2. Sellers are Retreating
Early October saw a spike in sell volume, but now sentiment across the market is improving, which could see the momentum shift back into the bulls’ favor. If so, buyers can aim to take XRP back above 60 cents. However, once there, sellers could return, as in late September.
3. MACD Momentum Shifting
After a difficult start this month, the momentum on the daily MACD is showing the first signs of a reversal, with a histogram making higher lows. If this trend continues, buyers could soon take over the price action and push XRP to break higher again.
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The price of Bitget’s BGB token unexpectedly dropped by 50% on the morning of October 7 before beginning to recover.
The platform has announced that it will compensate users for any losses resulting from the sudden volatility, which is still under investigation.
Exchange Promises Full Compensation
According to CoinGecko data, the incident saw the token’s value fall from $1.14 to $0.64 before staging a quick recovery. In a post on X, Bitget addressed the situation, saying, “BGB experienced unexpected volatility today due to market conditions, but the price has quickly stabilized.”
The platform reassured its users, promising to fully compensate for any asset losses. It also announced that a detailed compensation plan would be released within 24 hours, with the entire process set to be completed within 72 hours.
Bitget CEO Gracy Chen reiterated this message in a separate X post:
“The incident is still under investigation, but I want to assure everyone affected that we will not let any Bitget users suffer losses.”
Chen emphasized that Bitget’s overall standing remains strong, noting that the platform achieved a global market share of 11% in the third quarter of 2024, making it the fourth-largest exchange globally. Additionally, it boasts an asset reserve exceeding 176% and holds the second-largest protection fund globally, which is designed to compensate users quickly in the event of such incidents.
The Nature of Flash Crashes
Meanwhile, this incident mirrors a past development that occurred earlier this year with OKB, the native cryptocurrency of the OKX exchange. The token faced sudden price collapses, falling from a high of $48 to $25 within hours. The event was reportedly triggered by several large leveraged position liquidations, leading to further sell-offs and price declines.
At the time, OKX responded by reassuring its users that it would compensate them for the losses incurred from the unusual liquidation. While OKB’s crashes were linked to market-wide volatility, Bitget has yet to pinpoint the exact cause behind today’s event.
A cryptocurrency “flash crash” occurs when several holders rapidly sell a specific crypto asset, surpassing buyer demand and causing the price to drop sharply in a short amount of time. Unlike a typical collapse, the price usually recovers quickly, often returning to a level close to where it started.
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[PRESS RELEASE – Dubai, UAE, October 7th, 2024]
On October 22-23, the Blockchain Life 2024 forum will take place in Dubai. Over 10,000 participants from 120 countries will come together for the crypto event to share industry insights on the eve of Bull Run 2025.
Participants will hear from leading voices in the blockchain space, who will share market analysis on market trends and potential future developments.
Confirmed figures include:
- CEO Tether – Paolo Ardoino
- Co-Founder Animoca Brands – Yat Siu
- CEO Ledger – Pascal Gauthier
- CEO Cardano Foundation – Frederik Gregaard
- CEO Dubai Blockchain Center – Dr. Marwan Alzarouni
- Co-Founder Litecoin Foundation – Xinxi Wang
- CEO Vechain – Sunny Lu
- CEO of dYdX Foundation – Charles d’Haussy
- Founder Listing.Help, Jets Capital – Sergei Khitrov
- Founder DWF Labs – Andrei Grachev
- Co-Founder Tezos – Arthur Breitman
- CEO Trust Wallet – Eowyn Chen
- Co-Founder Osmosis Labs – Sunny Aggarwal
- Co-Founder of Sui (Mysten Labs) – Kostas Chalkias
- Head of Investments at Maelstrom Fund – Akshat Vaidya
- Founder Notcoin – Sasha Plotvinov
- Co-Founder, CEO Celestia Labs – Mustafa Al-Bassam
- Google Cloud – Tiago Henriques
- Program Lead MetaMask – Zied Brini
In addition to the lineup of speakers, Blockchain Life 2024 is also set to include behind-the-scenes discussions that will provide an opportunity for networking and exchanging information on the latest advancements in the sector.
The forum is coming soon. Readers can purchase tickets with a 10% discount using promo code chainwire.
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