The intense downward trend of the cryptographic market is finally penalizing the best digital asset of the month.
Ripple (XRP), now the second most important cryptocurrency in the market, no longer has a monthly value. Over the past 30 days, XRP has maintained the relatively good $ 0.5 level with minimal losses even during a period when the price of BTC and other major cryptocurrencies has declined by about 10-20%.
What caused the fall of XRP?
Being a liquidity network that provides major banks and financial institutions with the ability to transfer cross-border payments at low rates, a large XRP offering is critical to the operation of the Ripple blockchain network.
Similar to EOS, which has implemented several controversial rules on its protocol to prevent investors from holding EOS for a long period of time without using it, XRP must have a certain amount of outstanding XRP to ensure uninterrupted transactions for financial institutions.
In 2017, Ripple Labs CEO Brad Garlinghouse explained that XRP is entered into a escrow account and is distributed by Ripple Distribution to the public.
"The recently launched Escrow feature in XRP Ledger allows parties to protect XRP for a given period of time or until certain conditions are met, for example, Escrow allows a sender of XRP to place conditions exactly when a payment is made can be completed, so the payment remains encrypted blocked until the expiration date, "said Garlinghouse.
This week, around $ 16 million of XRPs have been moved from Ripple Distribution's portfolio to an unknown portfolio, injecting more XRPs into the market.
If the offer of an asset has increased artificially and investor demand remains the same, then it has a negative impact on the value of the asset in public markets.
In the last 12 hours, the price of the XRP has dropped from $ 0.48 to $ 0.41 at the daily minimum. The XRP recovered from $ 0.41 to $ 0.43, recording a daily loss against the US dollar of around 10%.
It is possible, since the XRP has had some success in defending the support level of $ 0.4, that the unexpected increase in the supply of outstanding XRP has influenced short-term price trend of XRP.
What happened to Bitcoin
Bitcoin has fallen substantially from the support level of $ 6,000, more than 35% in the last seven days. But the fund is said to be between $ 3,500 and $ 4,200, and BTC is expected to drop more than 80% in the short term before entering a consolidation phase.
"I'm not convinced I've hit the bottom yet." Check the sales volume so far. "If this had been the capitulation, a dramatic high-volume sale would have occurred, I think the worst has not yet arrived, but I'm getting ready for both scenarios: Lose the bull's mentality against the bear " a cryptocurrency technical analyst said.
The volume of BTC has risen by around $ 3 billion in the last few days, suggesting that there has been an intense bear liquidation and that BTC has not fallen freely without any selling pressure.
Shutterstock foreground image. TradingView Charts.
Get an exclusive cryptographic analysis by professional traders and investors on Hacked.com. Register now and receive the first month for free. Click here!