Ripple is back in the spotlight of the crypto community after a Reddit group responsible for pumping GameStop shares decided to orchestrate the same buying frenzy for XRP.
The past four days have witnessed an appreciation of the XRP / USD from $ 0.23 to $ 0.77 – an increase of 228%. XRP’s gains pushed market capitalization to $ 32 billion, making it the fourth most valuable cryptocurrency on the market.
On Monday, the XRP was correcting downwards, led by the sense of profit taking. Its price against the dollar fell 22% during Asian and European sessions, leaving traders exposed with two options: buy back at local lows or exit completely after securing the remaining profits.
What worked for Ripple is not an underlying foundation, but WallStreetBets, a Reddit group on a mission. His recent stint on the US stock market forced Melvin Capital to close its bearish positions with more than 53% of its capital lost.
The crypto community, known for its ancaps views on global finance, saw WallStreetBets as the cue to orchestrating bullish frenzies.
Dogecoin, a meme cryptocurrency that has virtually no reason to exist except to make jokes about the crypto industry, jumped more than 1,100 percent in a rally. However, its price has plummeted by up to 79% from the last $ 0.01 hike.
Dogecoin has not given up on its bullish dreams. After establishing a low near $ 0.02 on Saturday, it corrected it back to the upside by more than 100 percent. Now it is consolidating laterally – just like XRP.
But the XRP must still see its red candle. Unlike Dogecoin, which has some reasons to continue its bullish movement.
To update, Ripple is facing a lawsuit brought against it by the SEC. The United States securities regulator claimed in December that Ripple Labs, its CEO Brad Garlinghouse and co-founder Christian Larsen sold more than 14.9 billion XRP units, whose title is not registered, for about $ 1.38 billion.
XRP / USD lost half its value after the lawsuit, with many major exchanges, including Coinbase and Binance, opting to remove it from the list until further notice.
On January 29, Ripple Labs officially responded to the SEC’s complaint, claiming that the regulator is out of its jurisdiction because the U.S. Department of Justice and the Financial Crimes Enforcement Network (FinCEN) have already confirmed that XRP is not a title.
“Basically, on his way out, the Trump administration sought to undo the determination that XRP was a virtual currency made during the Obama administration,” added the company.
While the verdict is not yet clear, the answer may have helped fuel Ripple’s rally. The token still remains overbought on all accounts and may risk a technical correction. Analyst Michaël van de Poppe believes that the next buying opportunity will be when the cryptocurrency is in the $ 0.45 to $ 0.50 range, but the risks of wanting XRP remain greater.
“Avoid chasing bombs on DOGE and XRP”, added. “Determine the levels at which you can enter a trade to reduce your potential risk.”