Ripple’s XRP dropped nearly 10% in the past day as the crypto market
faced downward pressure. This downtrend, which has wiped 7% off the global market cap, followed a federal reserve rate cut and a significant outflow
from Bitcoin-focused ETFs.
The Federal Reserve’s announcement of a 0.25% rate
cut, coupled with Jerome Powell’s cautious outlook for 2024, triggered a wave
of selling in crypto markets. Data from CoinMarketCap shows that the overall crypto market capitalization is down 7% to $3.28 trillion.
Federal Reserve Sparks Market Selloff
While the rate reduction was widely anticipated,
Powell’s suggestion of a pause in monetary easing caught investors off guard.
Inflation concerns and uncertainty around fiscal policies added further
pressure.
Adding to the turmoil, spot Bitcoin ETFs reportedly recorded
massive outflows, with more than $600 million withdrawn in just 24 hours. High-profile
ETFs like Fidelity’s FBTC and Grayscale’s BTC accounted for the biggest share, CryptoPotato reported, unsettling sentiment across the broader market.
After reaching a multi-year high of $2.80, XRP has dropped more than 20% in the weekly chart. The price drop highlights a broader market
condition rather than Ripple-specific developments. The broader crypto market
saw similar declines, with Bitcoin dropping toward $93,000 and altcoins like
Dogecoin plummeting over 25%.
Optimism amid Uncertainty
While XRP’s recent performance might alarm short-term
traders, many analysts remain optimistic about its long-term prospects. XRP’s
challenges reflect the volatile nature of cryptocurrency markets, influenced by
macroeconomic trends and investor sentiment.
As Ripple expands its ecosystem, particularly with
initiatives like its Ripple USD (RLUSD) stablecoin, the company could have
positioned itself for growth in the next bull cycle.
Market analysts have cited monetary and fiscal
policies as catalysts for future crypto adoption. Despite short-term
volatility, XRP’s fundamentals and market position remain robust.
Its use case as a bridge currency and its growing
adoption among financial institutions could propel it toward new heights. Whether
the token achieves the ambitious $5 or $10 targets depends largely on broader
market conditions and Ripple’s continued innovation in the space.
Meanwhile, the SEC granted approval to two major Bitcoin and
Ether exchange-traded funds (ETFs) today (Friday). The approved funds are the Hashdex Nasdaq Crypto Index US ETF and the Franklin Crypto Index ETF.
According to the regulator’s statement, the Hashdex ETF will
track Bitcoin and Ether, while the Franklin ETF will reportedly focus on the
Institutional Digital Asset Index, a benchmark covering both Bitcoin and Ether.
This article was written by Jared Kirui at www.financemagnates.com.
Source link
