Prominent cryptocurrency gains 20% thanks to success in court against SEC
The 20% rally XRP has shown us in recent days was a logical response to Ripple’s success in the courtroom, despite the token’s lack of relationships with the prominent financial firm. However, the huge spike in trading volume and improving price performance is just the beginning.
250% to recover
Unfortunately, the 20% run is next to nothing for XRP as the cryptocurrency has lost over 75% of its value in the past few months. To reach values close to an all-time high, XRP would need a massive 250% rally that would bring it back to the $1.38 price level.
Unfortunately, the current net flow of funds in and out of XRP shows that a jump to the previous all-time high will not be possible without a major shift in the market. Despite the positive price performance of most assets today, the total market capitalization still remains below the important level of $1 trillion.
The Merge sale in the final phase
The Merge update fueled most of the assets in the market a few weeks ago and was 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 in cryptocurrency markets.
The same market participants who bought ETH in July or August sold the asset after a successful move to PoS, explaining why the profitability of the second-largest asset on the network dropped so much after the upgrade.
However, Ethereum developers are already working on the next Shanghai update by releasing updates to the previously existing EIP. The updated proposal provides a way to transfer validator recordings made over the Beacon chain to the EVM. The recording will have to be processed in the execution layer once they are “dequeued” from the consensus layer.
Bitcoin is not recovering
Unfortunately, the short-term 2% recovery we saw today is not helping the first cryptocurrency as BTC is gradually going down and has already lost 21% of its value in the past two weeks.
The high probability of a rate hike and unexpectedly high inflation are fueling investor fears, putting even more pressure on risky assets, including Bitcoin and other cryptocurrencies.
The results of the FOMC meeting will be announced later today. While most of the market expects a 75bp gain, cryptocurrencies are moving in the green due to the high probability of a relief coming after the Fed’s previously anticipated decision.
At the time of writing, BTC is trading at $19,284 and is up about 2.5% in the past 24 hours; however, the trading volume shows that the price increase is purely technical and investors are still out of the market.