Prominent cryptocurrency gains 20% thanks to success in court against SEC
The 20% rally XRP showed us in the last few days was a logical reaction to Ripple’s success in court despite the token’s lack of relations with the prominent financial company. However, the massive spike in trading volume and improving price performance is just the beginning.
250% to recover
Unfortunately, the 20% run is close to nothing for XRP as the cryptocurrency lost more than 75% of its value in the last few months. In order to reach values close to an all-time high, XRP would need a massive 250% rally that would put it back at the $1.38 price level.
Unfortunately, the current netflow of funds into and out of XRP shows that a jump toward the previous all-time high will not be possible without a major shift on the market. Despite the positive price performance of most assets today, the total market capitalization still remains below the important $1 trillion level.
The Merge sale in its final stages
The Merge update was fuel for most assets on the market a few weeks ago and one of the main sources of selling pressure after the upgrade went live. The main reason behind such a tendency was the “sell the news” rule used by most investors, especially on cryptocurrency markets.
The same market participants that purchased ETH back in July or August were actively selling the asset after a successful switch to PoS, which explains why the profitability of the second biggest asset on the network plunged so much following the upgrade.
However, Ethereum developers are already working on the next Shanghai update by releasing updates to the previously existing EIP. The updated proposal will provide a way for validator withdrawals made on the Beacon chain to get transferred into the EVM. The withdrawal will have to be processed in the execution layer as soon as they are “dequeued” from the consensus layer.
Bitcoin isn’t recovering
Unfortunately, the short-term 2% recovery we saw today is not helping the first cryptocurrency, as the BTC is gradually moving down, already losing 21% of its value in the last two weeks.
The high chance of a rate hike and the unexpectedly high inflation is dragging fears of investors upwards, providing even more pressure to the high-risk assets, including Bitcoin and other cryptocurrencies.
The results of the FOMC meeting will be released later today. While most of the market expects a 75 bp hike, cryptocurrencies are moving in the green due to the high possibility of a relief rally that happens after the previously expected decision is made by the Fed.
At press time, BTC is trading at $19,284 and gaining around 2.5% to its value in the last 24 hours; however, the trading volume shows that the price increase is purely technical and investors are still out of the market.