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Market Musings

XRP Back from the Dead and up 45% in 24 Hours — What the Hell is Going On?

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Published on:
January 7, 2021

Despite the fact that there's been no breakthrough in the SEC lawsuit, XRP has surged above $0.30.

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It’s been another day of impressive gains in the crypto markets.

 

Bitcoin continues to register new all-time highs — and as of 2pm London time, was in record territory after reaching $38,652.96.

 

Ether, now up two-thirds compared with where it was a week ago, stood at $1,226.25 at the time of writing. This means that the world’s second-largest cryptocurrency is within touching distance of $1,432.88 — the all-time high that was set three years ago this month.

 

But perhaps the most unusual bout of market activity relates to XRP, which is up 45.6% in the past 24 hours to hit $0.33.

 

This is an incredible bounceback for the embattled altcoin, which is currently at the center of legal action being pursued by the U.S. Securities and Exchange Commission. But here’s the weird thing: there hasn’t been any sort of massive breakthrough in this lawsuit, leaving many crypto analysts scratching their heads as to what caused the surge.

 

XRP’s market cap has effectively increased by $4.8 billion in a single day — meaning Litecoin’s ascension to No. 4 in the market cap rankings has been incredibly short-lived.

 

While some pundits on Crypto Twitter have likened XRP to a phoenix, others have likened the sudden surge to a “dead cat bounce.” Dusting off the dictionary, this term is used to refer to a temporary recovery in prices after a dramatic fall — and more often than not, the rise doesn’t last long.

 

XRP remains about 56% off the 52-week highs of $0.76 that were seen late last year — and 91% off its all-time high of $3.84. To make matters worse, any resolution in the lawsuit isn’t expected soon, as Ripple and the SEC are only expected to meet for the first time when a pretrial conference takes place in February.

 

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