After a heady week where the Ripple price surged to levels of $3.50 and hourly records, the past hours have showed a mass drop in price with the $1.50 level seeming to be the resistance level, a drop of well over 100% from those highs. Investors are currently losing thousands if they sell their positions at the moment as several got in on the hype when the price was about $3 or $3.30 and this is having an effect on sentiment with a bearish thrall affecting the market.
However Ripple’s loss seems to have been Ethereum’s gain since the price of that crypto currency surged to all-time record levels of around $1,300 on some exchanges although it is showing a slight retreat from these prices on Wednesday morning with the price now hovering at around $1250-1270 although this is still a hugely significant gain from just a few days ago when Ethereum was trading at $700-800.
All other crypto currencies suffered from the bearish Ripple sentiment and declined considerably in price. The chief loser from this was Litecoin which saw its price drop from highs of around $2.60 to well below $2.30 or a reduction of 20% at least. Bitcoin also suffered a huge loss in investor sentiment and is currently trading in the low $13,000’s – that’s a remarkable 25% drop from its recent highs of $17,200 achieved just a few days ago. This week has been a black one for crypto currencies as the market cap has now declined to well under the $700 billion mark from highs of $850 million again just days ago.
Other cryptos which saw heavy losses from previous intraday highs included Dash and to a lesser extent Ethereum Classic. The former saw a drop of around 6% overall and seems stuck in the $1000-1100 range for the foreseeable future. The latter saw a rise comparable to its sister currency Ethereum of around 10-15% but then fell back and was trading at around $32 which represented a loss of around 7% on a day to day level.
Ethereum Benefits From Ripple’s Downfall
Since January 4, the market valuation of Ripple XRP decreased from $148 billion to $73 billion, falling by nearly 2-fold in a single week. On the contrary, the market valuation of Ethereum surged from $85 billion to $135 billion, recording yet another 15 percent increase in value today, on January 10. The value of Ripple has fallen further in the last few hours and is now closer to the $65 billion mark as traders take profits with some exchanges even holding the price and not opening the market to any buy orders.
The recent surge in the price of Ethereum can be largely attributed to the sell-off of XRP, which was likely triggered by the market’s concerns over the sudden spike in the market valuation of Ripple. The harsh criticism of Ripple by analysts such as ConsenSys entrepreneur-in-residence Ryan Selkis could also have led to the decline in confidence towards Ripple.
On December 29, Selkis noted that the majority of Ripple’s partner banks are not actually utilizing the Ripple network to process billions of dollars on a regular basis. Given that the transaction volume of Ripple and its network of banks can be only two factors that could possibly justify its market cap, the market’s interest in Ripple decreased in the short-term.
However these claims have been rebutted by Ripple’s CEO Brad Garlinghouse who has insisted that the payment system is alive and well and is currently in use across several platforms. Still this has not prevented Ripple’s price from tanking in the short term and for those who went in at high prices, the prospects look pretty bleak for the moment.