XRP Falls to Familiar Support Despite Adoption Spike
XRP’s price was back on the defensive Saturday and eyeing familiar support near $0.30 amid a broad pullback in the cryptocurrency market. Unlike its major peers, the so-called ‘banker’s cryptocurrency’ has done very little to shake-off bearish sentiment in 2019 despite seeing an institutional adoption spike.
The value of XRP reached a low of $0.3073 on Saturday, bringing it within range of a significant long-term support. It was last seen trading at $0.3094, having declined 2.2%, according to CoinMarketCap. XRP is down more than 6% over the past seven days.
The cryptocurrency has performed much better against bitcoin, which appears to be deflating following months of oversized gains. On Saturday, XRP was up 1.4% against BTC.
Over the past 90 days, XRP’s price has fallen below the 30-cent mark on only one occasion. Within the aforementioned period, the price traded as high as $0.5054 before correcting sharply lower. If recent history is any indication, XRP buyers will likely sweep in at current levels. Their ability to generate sustained bids will be challenged by several known resistances, including $0.35, $0.40 and $0.48.
At current values, XRP has a total market capitalization of $13.3 billion.
Institutional Interest Rises
XRP’s price has languished despite a noticeable increase in adoption rates among institutional players. Ripple, the parent company behind XRP, reported earlier this week that it sold 900 units of its virtual currency in the second quarter. They were sold at an average price of $0.27, which was 50% higher than the previous quarter. In U.S. dollar terms, XRP token sales brought in $251.5 million.
Roughly 42% of that total were “institutional direct sales,” the company said in its latest quarterly report.
Notably, xRapid transactions shot up 170% quarter-on-quarter thanks in large part to a sustained increase in partnerships. The xRapid system allows payment providers and other financial institutions to source liquidity while minimizing end-user costs. Basically, xRapid uses XRP as a bridge currency to eliminate costs and processing delays in cross-border payments.
Among Ripple’s many partners is MoneyGram, the global money transfer service. The two companies inked a deal in June that effectively made Ripple MoneyGram’s key partner for cross-border payments and foreign exchange settlement via digital assets.
Due to concerns over inflated trade-volume data, Ripple said it will rely on CryptoCompare for benchmarking market turnover going forward. As Hacked recently pointed out (here and here), most of the reported cryptocurrency volume is fake.
Earlier this year, CryptoCompare launched an Exchange Benchmark feature that essentially ranks global cryptocurrency exchanges. The feature was launched precisely in response to growing concern over inflated volume data.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Chart via CoinMarketCap.