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Ripple’s XRP joins cryptocurrency market in one more tumble

Ripple's XRP joins cryptocurrency market in one more tumble
Written by publisher team

In any other asset class, it would have been worrisome. For cryptocurrency investors, it’s Tuesday.

BTC, ETH, BNB, ADA, XRP, DOGE, DOT, UNI: Is monthly crypto crash the new thing?

Yesterday, we covered the moment the cryptocurrency market turned red for the day, even though three instruments (Binance Coin, Polkadot and Uniswap) were still counting gains in a 7-day period. Half a day later this is no longer true.

Risk sentiment as a whole has disappeared, and along with stablecoins, the first cryptocurrency in the green can only be found in the 53rd place of cryptocurrency by market capitalization – Hedera Hashgraph (5.00%), but the volatility has shifted significantly, so it is possible that be good. Be in the red as you read this.

A recent report by CryptoCompare highlighted that spot volumes fell by 42.7% after the ban on crypto mining in China while total derivatives volumes fell by 40.7%.

The June crypto crash saw Bitcoin drop to a monthly low of $28,908, ending the month 6.0% lower.

The negative news from China was balanced by the positive news from El Salvador, which became the first country to officially adopt bitcoin as a legal tender.

However, a leaked report by JP Morgan shows that the high volatility of Bitcoin is a major challenge along with the country’s official dollarization and warns of high demand for Bitcoin-to-US dollar transfers on the government’s Bitcoin spending platform that could “disintegrate the internal dollar liquidity”.

The daily payment activity in El Salvador represents [around] 4% of the volume of recent transactions on the chain and more than 1% of the total value of the tokens transferred between wallets in the past year.” It is now believed that a significant portion of Bitcoin is locked in illiquid entities and that 90% of Bitcoin does not move in more than general.

Why are cryptocurrency prices dropping now that we are in mid-July? Probably because they fell in mid-June. and mid-May (with a lot of force) and every month this year either as a correction or as a more sustainable movement.

“Cryptocurrency crash” has become a popular expression for the digital asset markets, but it is mostly due to volatility that cannot be found anywhere else. In any other asset class, it would have been worrisome. For cryptocurrency investors, it’s Tuesday.

However, Ethereum is down about -15% in a 7-day period making it the worst performer in the top ten at the moment. This may be revealing as the market is expecting ETH2 to upgrade from Proof of Business to Proof of Stake.

There is an issue to be raised about changing Ether’s status in the eyes of US regulators. Digital assets are informally considered a commodity, but the SEC may eventually consider it a security.

The move could be motivated by the FSA’s need to show clarity and impartiality amid the SEC’s lawsuit against Ripple.

Ripple Labs put pressure on the regulator by contacting former SEC director William Henman, who stated that Ethereum and Bitcoin are not securities. Hinman then moved to a law firm close to the Ethereum Foundation after leaving the Securities and Exchange Commission, prompting accusations of conflict of interest.

The defendants recently requested that the filing date be set for July 19, 2021, a week from now. This could be a sign of growing impatience between Ripple Labs and its founding partners as back-and-forth motion prevents the company from going ahead with its planned IPO.

The aforementioned impatience may be related to a letter from US Senator Elizabeth Warren to Securities and Exchange Commission Chairman Gary Gensler, which implicitly gives the SEC broader authority over the asset class.

That did not sit well with many in the space, including influential names within the XRP community, who see it as a “co-ordinated game” by SEC chief Senator Warren, and the SEC to beat its regulatory sister, the CFTC.

Despite the tense legal battle between the blockchain company and the US regulator, Ripple continues to introduce new use cases for the XRP Ledger, most recently tokenizing the asset.

Its plans to go public via the initial public offering will remain restricted until the lawsuit ends. When does the lawsuit end? And why does it take so long? Very legitimate questions in such a fast-paced industry.

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