XRP dips to $0.52 as Ripple SVP comments on stablecoin raise concerns

Source Fxstreet
Apr 25, 2024 07:42
  • Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. 
  • Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP. 
  • Attorney Bill Morgan warns market participants of the consequences of a lawsuit decision that stops XRP usage in ODL.

Ripple (XRP) declined to $0.52 on Thursday, erasing all gains registered earlier this week. Ripple Senior Vice President (SVP) Eric van Miltenburg’s comments on the firm’s stablecoin, and how it is expected to benefit the XRP Ledger and native token XRP have raised concerns among crypto experts. 

XRP price has been declining since Tuesday, following Ripple’s response filing to the SEC’s request for $2 billion in penalties.

Daily digest market movers: Ripple holders digest stablecoin news and response to SEC filing

  • XRP price wiped out Monday’s gains as holders digested the announcement of Ripple’s stablecoin and the firm’s response to the SEC’s request for $2 billion in fines. 
  • Ripple SVP told the Digital Frontier that Ripple plans to launch its stablecoin on the XRP Ledger, “which will ultimately be good for the ecosystem.” Miltenburg supports his claim citing Polygon’s example of how the introduction of stablecoins increased the Total Value Locked (TVL) on the chain and improved trust. 

XRP

The XRP question

  • Tokyo-based crypto expert @sentosuMosaba asked Ripple CTO David Schwartz whether some of the "cash equivalents" (that are going to back the USD-pegged stablecoin) going to be the digital asset XRP held by Ripple. The expert asks Schwartz why the comparison between increasing TVL and stablecoin usage on the blockchain. 
  • Attorney Bill Morgan reminded XRP holders that a decision on Ripple’s On-Demand Liquidity (ODL) corridor could influence the asset. The ODL is Ripple’s liquidity management solution that powers instant, cross-border transactions, and money transfers. 
  • XRPLedger’s native token XRP serves as the bridge currency for Ripple ODL’s liquidity management solution.
  • Morgan argues that if the court orders a permanent injunction (meaning an order to cease a specific action) on Ripple’s use of XRP in the ODL, it could negatively impact the asset’s utility and price. This is a cause for concern among XRP holders. 
  • For XRP holders, Ripple’s stablecoin launch and the recent response filed against the SEC’s request for $2 billion in penalties are the key market movers that can influence the asset’s price. 

Technical analysis: XRP wipes out Monday gains

XRP is changing hands at $0.5271 on Thursday as traders note inaction in BTC/USDT pair. Five days after the BTC halving event, the asset failed to cross the $67,000 level four days in a row. Bitcoin price trend influences large market capitalization altcoins like XRP. 

The XRP/USDT pair pares its weekly gains, down from Monday’s close of $0.55, to $0.52, at the time of writing. Despite the correction, XRP price is nearly 25% higher than the YTD low set earlier in April, $0.4188 (April 13). 

If XRP price gains acceptance above the 50% Fibonacci retracement level at $0.5310, plotted from the April 9-13 downfall, it could climb towards next resistance at $0.60. This marks a psychologically important level for XRP traders. 

The Moving Average Convergence Divergence (MACD) indicator is in the positive territory, supporting the positive momentum in XRP’s uptrend. Additionally, the crossover above the signal line is a bullish sign for XRP price. 

XRP

XRP/USDT 1-day chart

On the flip side, the April 21 low at $0.5183 has established itself as key support this week. A close below this level could invalidate the bullish thesis for XRP. 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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