Ripple’s native cryptocurrency XRP is booming at the start of the new year, suddenly spiking by 10% on Monday. In the past few days, the coin started showing signs of recovery and has now returned to $0.21. What was behind the rally? Below are 3 plausible reasons for the price pump.
January 6, 2020, | AtoZ Markets – Ripple price has been pressured by its protracted slide and has fallen almost every time the Ripple escrow account released new coins. But now, the asset looks like it’s switching to a new trend, as the latest tranche in late December did not shrink the price further.
The price of XRP has increased from $0.19 to $0.21 from the day’s lowest point to highest, by just over 10%. Here are 3 major reasons why the Ripple price is rising.
1. Binance futures launches XRP/USDT contracts
The triggering event for the latest price climb seems to have come from Binance’s announcement of an XRP futures market. This new form of speculative trading would make it possible to bet on price swings without settling for the underlying asset. A futures market may also be more liquid, and lack the danger of whales dumping on the spot market.
This also means more inflow of USDT speculation for the XRP market, as the new perpetuity will be open to large stablecoin owners to open and settle positions.
2. 2020 enthusiasm
After an underwhelming December, XRP price declined to as low as $0.18. At that level, the community lost some of its hopes, but buyers kept stocking up on the asset in case of a rogue rally. Now that the rally is here, the hype may accelerate, with higher volatility expectations.
The seasonal hype after the New Year, plus renewed activity after the end of the holidays, boosted XRP trading. Volumes are expanding slowly, to around $1.6 billion per day. This amount is still relatively small in comparison to other leading coins, but low volumes also make it easier for XRP to begin a price hike.
3. Ripple price rises against Bitcoin
Another reason for the rally may be from insider trading, as the surge suspiciously happened just before the official Binance announcement was released. There’s no evidence to support this claim, but it is highly coincidental that Ripple price spiked so dramatically ahead of a major announcement.
This is a shorting dream https://t.co/aloBT9jaRu— Larry Cermak (@lawmaster) January 6, 2020
For the asset, some of the most extreme predictions allow for displacing BTC. However, for now, the coin is fighting to regain positions and confidence.
What do you think of the Ripple price surge? Let us know in the comments section below.