Ripple price: Why is Ripple crashing on the markets? XRP down 30% on record high

Ripple price: Why is Ripple crashing on the markets? XRP down 30% on record high

- in Business

The new crypto contender briefly topped Ethereum’s second place in the charts on Sunday, with a staggering market capitalisation of more than £90billion ($123billion).

But was dealt a crippling blow on Monday morning when its market cap fell almost £30billion ($40billion) in value by the afternoon, according to CoinMarketCap.

Ripple’s signature token, XRP, was not spared any blows either when prices fell from over £2.22 ($3) per token to a January low of £1.74 ($2.35).

On Tuesday January 9 at 4.47pm GMT, the token was exchanging hands at £1.75 ($2.35), down 4.27 percent on yesterday’s price.

Why are Ripple’s prices crashing?

The sudden collapse in Ripple prices came as a surprise to investors who jumped the crypto bandwagon after XRP skyrocketed an incredible 35,000 percent in 2017.

Unlike its main competitor , Ripple has the backing and support of finial institutions like the Bank of America and Santander, who have adopted the money transfer system.

But Erik Vorhees, CEO of cryptocurrency exchange ShapeShift, argued that this drove the cryptocurrency into a speculative bubble of its own making.

The finance expert accused Ripple of boosting its allure on the markets by exploiting the backing it has received from big banks. 

Ripple Prices on CoinMarketcapCOINMARKETCAP

Ripple prices: The XRP token took a hit to its market capitalisation at the start of the week

Mr Vorhees said: “Testing crypto with banks doesn’t make sense. The whole idea of crypto is you don’t need banks.”

The technology behind Ripple is aimed at banks as a faster and more secure alternative to money transfer systems such as SWIFT. 

However some crypto experts have argued this sort of centralisation with banks is antithetical to the decentralised and unregulated nature of cryptocurrencies. 

This leads to another possible reason why Ripple and other major crypto tokens took a hit this month – crypto regulation in South Korea.

Investors such as Gabor Gurbacs, at VanEck Associates Corp, argued that any rumour of regulation in East Asia heavily reverberates through the markets.

He said: “News on the regulatory front is dragging down cryptos.

News on the regulatory front is dragging down cryptos

Gabor Gurbacs, VanEck Associates Corp

“South Korea and China tightening is weighing on bitcoin and in the ICO market, things started slowing down, with the SEX cracking down on illegal offerings.”

South Korea’s financial regulators, the Financial Services Commission (FSC) and Financial Supervisory Service (FSS), recently announced a joint effort to investigate six local banks that offer virtual currencies as part of their offer.

But the appetite for cryptos is not waning in Korea and Ripple prices surged as high as £2.96 ($4) on some exchanges – higher than its Western counterparts.

Ripple Prices on LiveCoinWatchLIVECOINWATCH

Ripple prices: XRP is trading higher on South Korean exchanges

CoinMarketCap does not include Korean exchanges in its token valuations, which could be another possible clue as to what is dragging prices down.

Ripple prices are considerably higher today on LiveCoinWatch, which tracks South Korean exchanges Bithumb and Coinone, where the prices were £2.52 ($3.41) at 4.44pm GMT respectively.

Naeem Aslam, chief market analyst at TF Global Markets, argued that regulators need to focus on this market to find a solution to the price discrepancies between exchanges.

He said: “We need regulators to look into the space more closely, the Korean exchanges have become crazy in terms of price differences so these regulatory actions would help the price stability.”

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

You may also like

Property in French Alps: A big break in snow business

N/A Le Roc des Tours is in the