What is pushing the XRP price near record levels?
In recent weeks, XRP witnessed an incredible rally, outpacing a landmark US$200 billion market capitalisation for the first time in its life. The digital asset advanced by above 70 per cent within a span of a month, outpacing the entire crypto world.
The interesting proportion gained by XRP versus Bitcoin was about 35% in the first days of July, whereas Ethereum gained 25% only versus BTC during the same days. Analysts speculate that the relative strength might bear the inception of an uptrend with money shifting from Bitcoin to a few altcoins, including XRP.
Distinctively, almost parallel momentum in XRP-Coinland view must be contradictory to altcoin attraction just after Bitcoin’s exhaustion period on June highs.
How significant is the US$200B milestone for XRP?
Crossing the US$200 billion market capitalisation barrier would mark an important psychological and technical resistance for the digital asset. By way of perspective, XRP had a market cap of just above US$125 billion during mid-June, before the start of its meteoric rally.
Technical analysts consider the breaking of a multi-year descending triangle pattern as yet another catalyst. This bullish chart pattern generally is the finale to long-term consolidation, allowing for sustained upward movement.
Now with XRP trading near US$3.80, many traders are eyeing a return to the former all-time high in excess of US$4 set in early 2018.
Will XRP price sustain the bullish trend?
The price action of XRP tells the story of great bullish momentum. This breakout has not only been confirmed on the daily chart but has started gaining traction on weekly and monthly timeframes, giving long-term investors added confidence.
Fibonacci extension is among the chief indicators that hint towards this belief. A 1.618 Fibonacci extension from the most recent swing low is projecting XRP’s market cap to somewhere around USD 250 billion. If realised, the price, in turn, needs to go up toward US$4.80.
Whale activity is also intensifying in the scene. Large wallet addresses belonging to institutional investors and early adopters have been accumulating the altcoin since the beginning of the rally. From data analysed by blockchain analytics platforms, these addresses do not just increase in size but also the frequency of their transactions.
Can XRP outperform Bitcoin and Ethereum this cycle?
While Bitcoin continues to hog the headlines, a seasoned scoop-set analyst has performed a deep analysis of the movements of XRP. The recent gains it has made against BTC and ETH show some rotation of capital into altcoins.
Generally, such rotations are witnessed after Bitcoin marks a fresh all-time high; this consolidation phase allows altcoins, which always lag during the early stages of a bull market, to catch up really fast. So, for now, it looks like this trend is led by XRP.
Likewise, that being said, it will depend on the dominating market sentiment. It is likely that if Bitcoin goes for a steep correction, XRP may be subjected to a retracement. But for the present time, the trend seems to favour bullish XRP, as both technical and on-chain signals are favouring a rally.
Bitcoin Market Share
What’s driving investor interest in XRP now?
Worth noting here is how technical breakouts or rising whale interest have caused optimism to brew on renewed regulatory clarity. The XRP blockchain has been going through lawsuits with the U.S. Securities and Exchange Commission (SEC), but recent developments seem to favour the company behind XRP-Ripple Labs.
Any positive court outcomes may offer a second big impregnable catalyst. It can give way to new partnerships, wider utility, and liquidation of a slight risk that has halted institutional intervention via an asset.
Additionally, XRP is featured as one of the first tokens for cross-border payment liquidation, especially in Asia-Pacific corridors. Assuming a rise in remittance volumes worldwide, XRP may have positive spillovers in this regard as a liquidity bridge.
What risks could slow XRP’s momentum?
This momentum is strong, but some threats persist. Chief among them is the volatility in the wider crypto market. If there is a sharp correction in Bitcoin price or if macroeconomic data start appearing negative, there could be widespread pressure on all cryptocurrencies, including XRP.
Also at risk is the possibility of a bull trap. A false breakout might drag down the price of XRP toward US$2.50 or lower, thus nullifying any bullish short-term theories. It is advisable for traders to keep an eye on volume, support levels, and whale activity for confirmation of trend continuation.
Then, signalling sentiment may be weighed down by regulatory uncertainty, particularly if the SEC case faces a lengthy delay or explodes into new controversies.
Also Read: Gryphon Capital Income Trust Delivers 8.50% Yield Amid Market Expansion
Key Investor Takeaways:
- XRP is drifting near a US$200B market capitalisation for the very first time.
- Over 70% gains have been achieved in the past month, ranking top in acquisitions before Ethereum, Bitcoin.
- A technical breakout and buying by whales support the sustainability of the rally.
- Given continued momentum, XRP can trade at around US$4.80, which will push the market capitalisation closer to US$250B.
- Regulatory clarity, increasing use cases, and broader rotation into altcoins could act as catalysts for more upside.
- The bullish expectations could, however, find resistance in Bitcoin’s volatility and the risks emanating from the legal front.
