TL;DR
Ripple’s XRP has dropped 10% in two weeks, with declining transaction activity and a broader market downturn suggesting that its correction may continue.
The ongoing Ripple v. SEC lawsuit could introduce more volatility for XRP, with recent legal developments sparking speculation of a potential appeal by the regulator.
XRP to Bleed Even More?
The past two weeks have been unpleasant for Ripple’s XRP, whose price tumbled by 10% and is currently trading at around $0.53 (per CoinGecko’s data).
XRP Price, Source: CoinGecko
While XRP bulls eagerly await a renewed price revival, some crucial factors hint that the correction might be far from over. The first element is the broader decline of the entire cryptocurrency market, where Bitcoin (BTC) slipped below $56,000. It will be interesting to see whether the sector recovers some of the losses incurred in the following days and whether XRP could head north, too.
The second factor is the number of XRP payments from one account to another. Data shows that the figure has fallen from almost 570,000 on September 1 to 370,000 as of today (September 6). This indicates decreased processing activity and could be a sign of reduced engagement within the ecosystem.
For its part, the number of active XRP accounts is down 65% on a five-day scale, reinforcing the aforementioned worrying thesis.
Number of Active XRP Accounts, Source: XRPscan
Last but not least, we will touch upon the number of transactions that have been executed. The figure spiked above 1.5 million at the start of September, only to plummet below 850,000 on September 6. This decline could reflect a change in market sentiment, with some investors losing confidence in XRP, thus triggering a further negative impact on the price.
The Ripple v. SEC Case
The ongoing lawsuit between the two entities may also propel enhanced volatility for XRP in the near future. The legal battle reached a major milestone last month when Judge Torres ruled that Ripple must pay a $125 million fine for violating certain securities laws.
The sum represents a 94% deduction on the SEC’s initial request, which caused many industry participants to declare the decision a major win for the company. XRP’s price reacted positively, soaring by double digits shortly after the announcement.
Earlier this week, Ripple filed a motion requesting a stay on the monetary portion of the Court’s Judgment entered in August. The firm’s lawyers revealed that the regulator agreed with the proposed terms and delay of the payment (which was due on September 6).
Some X users assumed that this move could be a precursor of a potential appeal by the SEC, which might not be pleased with the initial ruling. The American attorney Fred Rispoli, for instance, said:
“Going through all this effort with establishing a trust for the funds boosts chances of an appeal IMO. But ultimately, this is just the safest play for SEC to buy time until the Oct. 7 deadline to appeal.”
It will be interesting to follow the news surrounding the case and check if they will have some impact on XRP’s valuation.
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