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Home NewsLatest News 3 Reasons XRP is Down 25% Since December

3 Reasons XRP is Down 25% Since December

by bitcoinews.us


Since the start of 2024, the digital asset industry has certainly been volatile. Indeed, a host of assets have not enjoyed the rapid start to the year that they had hoped. Among the most affected is Ripple, which has seen its XRP token decline 25% since the end of December.

The asset, along with the greater digital asset market, has seen a rapid decline today. Specifically, XRP is currently down more than 3% over the last 24 hours according to CoinMarketCap. However, it has been down as much as 7% on the day.

The largest question is why? Specifically, what has affected the XRP price to such a degree that it is finding massive declines in the early weeks of the month? Well, that’s what we’re here to answer. So, let’s discuss three reasons why XRP has been down since December.

Investor Behavior and Technical Data

XRP
Source – Siam

Also Read: Ripple XRP January End Price Prediction

One of the key reasons why Ripple (XRP) is down 25% since December is both investor behavior and its technical data. Specifically, the overall downtrend is part of a much larger story for the digital asset.

Often, an asset will experience such a downtrend when it tests a multi-month descending trendline resistance. Subsequently, XRP retested the trendline on December 28; which was the start of its massive decline.

Alternatively, this week sees the asset face another technical threshold. This time, it is a multi-month ascending trendline support. This could bring good news, as it could precede recovery, but the momentum is not working in favor of the asset.

XRP has been trading below various moving averages and the RSI is showcasing a potentially oversold state. Whether or not this attracts buyers remains to be seen, but that could be the catalyst for bringing the asset back to manageable levels.

Lack of ETF Product News

ripple xrp

Also Read: Ripple (XRP) Faces Vital $0.48 Support, Is a Turnaround Possible?

Heading into 2024, Spot Bitcoin ETFs dominated the digital asset market. There was so much optimism related to their eventual approval. When the investment products did receive landmark approval on January 11th, the industry didn’t react the way that many had hoped.

Where this affects XRP is the discourse that the sentiment around Bitcoin has brought about. Specifically, many viewed the potential for a Sot XRP ETF. Despite the asset’s regulatory concern, many had hoped that asset managers like BlackRock would see the value in the Ripple token.

However, those expectations had slowly begun to fizzle out. Reports started surfacing that the asset manager had no interest in bringing the investment product to launch. Moreover, the decision was understandable, especially considering the lawsuit that is ongoing between ETF Issuers the US Securities and Exchange Commission (SEC), and Ripple.

However, that clarification has led to a 13% decline in the asset. Despite a likely positive outcome of the aforementioned lawsuit, it appears as though the industry at large has developed a concerning perspective of the asset’s place in the greater cryptocurrency landscape.

XRP Whale Drop

ripple xrp cryptocurrency coin token
Source: cryptonews.com

Also Read: Ripple: How Much XRP Do You Need to Make $1M, $10M if Price Hits $8.54?

Finally, a massive reason why Ripple (XRP) has fallen so much since December is connected to the fall of large holders of the digital asset. Specifically, the overall decline of XRP can be correlated with the drop in some of its largest holdings.

When it comes to observing addresses with a balance of 100 million to 1 billion tokens, the figure dropped drastically in January. Indeed, that drop had run parallel to an increase in investors who hold between 10 million and 100 million tokens.

This shows that those addresses that were holding almost a billion XRP tokens had sold or redistributed their XRP. Therefore, it has had a correlating impact on the overall decreasing price of the asset since the start of the year.



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