This week, Ripple’s XRP token suffered a major blow. On Wednesday, it tanked 6% and nipped at the heels of third place in the cryptocurrency market capitalization rankings.
Ripple’s announcement in late January that its long-awaited $RLUSD stablecoin would not be launched as planned followed a sharp decline when investors feared the token would not be launched after regulatory approval was sought. Ripple’s native token, XRP, lost its spot in the crypto market hierarchy, falling from an intraday high of $2.68 to close at $2.3574.
Despite some speculation, $RLUSD isn’t launching today. We’re in lockstep with the NYDFS on final approval and will share updates as soon as possible.
We are fully committed to launching under the supervision of NYDFS and upholding the highest regulatory standards. Stay tuned…
— Ripple (@Ripple) December 4, 2024
As the market cap of XRP shrinks, Tether’s USDT stablecoin staked its claim to the third position, with a market cap of $135.8 billion. Ripple’s battle with regulators and market sentiment has seen it shaken up in the ranks as the volatility surrounding its operations becomes more evident.
XRP Faces Trading Volume Plunge Amid Stablecoin Surge
According to Ripple, the launch of the $RLUSD stablecoin was delayed due to pending approval by the New York Department of Financial Services (NYDFS). The decision was taken to secure compliance, though panic selling further increased market uncertainty.
XRP’s trading volume plunged from $32 billion to ~$16 billion, and Ripple’s reserves fell by $12 million. By the end of the trading day, its 24-hour volume was down 39 percent to $26.02 billion.
A rise in stablecoin activity across the market added to XRP’s woes. Stablecoin volumes surged 26.88 percent in the last 24 hours to $327.85 billion as participants turned their attention to perceived safer assets during uncertain times.
Analysts are cautiously optimistic that turbulence will fail to compromise XRP despite a change in the season. Market commentator @ergagcrypto wrote, “XRP is pretty unlikely to stale too low below the $2 mark again,” empowering investors with confidence in an asset’s underlying value.
#XRP – $2: The Next Macro Support?
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Alert: This is your wake-up call!🚨 🔥
You Might Not See #XRP Below $2 Again! 💎
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✅#XRP is just 29 days away from potentially… pic.twitter.com/LU3I9fkews— EGRAG CRYPTO (@egragcrypto) December 2, 2024
Ripple’s SEC Case Gets to a Turning Point
As a continuously dragging ripple in their legal battle with the U.S. Securities and Exchange Commission (SEC), we’re at the tail end of what many have heralded as a major turning point. Former SEC Chairman Gary Gensler is stepping down at the end of January, and Paul Atkins, a proponent of innovative financial technologies, has emerged as his replacement.
Crypto fans hope Atkins’ potential appointment will result in a friendlier regulatory environment. Recent intrigue also surrounds the meeting between Ripple CEO Brad Garlinghouse and former President Donald Trump, should that work result in supportive legislation or strategic partnerships.
For market observers, January is one of the most watched months for signs of confidence in Ripple and its XRP token being rekindled. In the short term, the delay of the $RLUSD stablecoin launch has stirred investor sentiment. Still, if the SEC case against Ripple comes to a close and regulatory leadership changes, it could signify a sea change for the company.
