Heres Why The XRP Price Plunged To $0.55
The XRP price has dropped to $0.55 as the crypto token continues to struggle to break above the $0.60 resistance level. This recent drop is due to several factors, including Ripples recent token unlocks.
Ripples Unlocks Causes Price To Drop
According to the on-chain analytics platform Whale Alert, Ripple unlocked 1 billion XRP tokens ($559 million) from its escrow wallet on September 1. This formed part of the token unlocks, which the crypto firm is known to carry out monthly. These token unlocks were carried out in three transactions, with 500 million XRP, 200 million XRP, and 300 million XRP unlocked from the escrow wallet in these three transactions.
This sparked a bearish sentiment for the XRP price, causing it to drop. Ripples XRP unlocks always create a supply shock, which causes XRP investors to panic and sell off their holdings in fear that the crypto firm may be looking to offload some or all of the tokens that it has unlocked from escrow.
This panic among XRP investors comes despite reports that Ripples XRP sales do not impact the cryptos price on exchanges, as they are likely done over the counter. Meanwhile, Ripple once again received criticism from some members of the XRP community following the recent token unlocks, with one of them calling the crypto firm a scam.
Another reason the XRP price plunged to $0.55 is the current bearish sentiment in the broader crypto market. Bitcoin (BTC) dropped below $58,000 on September 1, thereby sparking a downtrend for other crypto tokens.
The flagship cryptos price action has remained indecisive, weighing on the fate of other tokens. The XRP price is undoubtedly at risk of dropping lower if Bitcoin fails to establish a bullish trend soon enough and rises above $60,000.
Some Positives For The XRP Price
Despite the panic caused by Ripples XRP unlocks, it is worth mentioning that the crypto firm locked 800 million XRP ($442 million) tokens back in escrow. This is a bullish development for the XRP price as it will help allay the fears of XRP investors who believed that Ripple was looking to sell the 1 billion XRP tokens that were earlier unlocked.
Another positive for XRP and its holders is that the likelihood of the US Securities and Exchange Commission (SEC) appealing its case against Ripple is dropping as the 60-day window for the Commission to do so draws closer. If the SEC eventually chooses not to appeal, that will provide some bullish momentum for the XRP price, considering how much impact the lawsuit has had on the crypto so far.
At the time of writing, XRP is trading at around $0.549, down over 1% in the last 24 hours, according to data from CoinMarketCap.
Read more: https://www.newsbtc.com/analysis/xrp/xrp-price-plunged-to-0-55/
Text source: NewsBTC
