Is the price of Ripple (XRP) in greater danger? 4 factors to consider

TL;DR

Ripple’s XRP is down 10% in two weeks, with declining transaction activity and a broader market decline suggesting its correction may continue. Ripple’s ongoing lawsuit against the SEC could introduce more volatility for XRP, with recent legal developments prompting speculation of a possible appeal by the regulator. XRP to bleed further?

The past two weeks have been ugly for Ripple’s XRP, whose price has fallen 10% and is currently trading around $0.53 (according to CoinGecko data).

XRP Price, Source: CoinGecko

While XRP bulls eagerly await a renewed price rally, some crucial factors indicate that the correction may be far from over. The first item is the broader decline in the entire cryptocurrency market, where Bitcoin (BTC) fell below $56,000. It will be interesting to see if the sector recovers some of the losses incurred in the following days and if XRP could also head north.

The second factor is the number of XRP payments from one account to another. The data shows the number has dropped from almost 570,000 on September 1 to 370,000 as of today (September 6). This indicates a decrease in processing activity and could be a sign of reduced engagement within the ecosystem.

For its part, the number of active XRP accounts is reduced by 65% ​​on a five-day scale, reinforcing the aforementioned worrying thesis.

Number of active XRP accounts, source: XRPscan

Last but not least, we will touch on the number of transactions that have been made. The number rose above 1.5 million in early September, only to fall below 850,000 on September 6. This drop could reflect a change in market sentiment, with some investors losing confidence in XRP, thus causing a further negative impact on the price.

The case of Ripple v. SEC

The ongoing demand between the two entities may also drive higher volatility for XRP in the near future. The legal battle reached a major milestone last month when Judge Torres ruled that Ripple must pay a $125 million fine for violating certain securities laws.

The sum represents a 94% deduction from the SEC’s initial request, prompting many industry participants to hail the decision as a major win for the company. The price of XRP reacted positively, rising by double digits shortly after the announcement.

Earlier this week, Ripple filed a motion requesting a stay of the monetary portion of the Court’s ruling filed in August. The firm’s lawyers revealed that the regulator agreed to the proposed terms and delayed payment (which was due on September 6).

Some X users speculated that this move could be a precursor to a possible appeal from the SEC, which may not be satisfied with the initial decision. US Attorney Fred Rispoli, for example, said:

“Going through all this effort to establish a trust for the funds increases the chances of an appeal at the IMO. But ultimately, this is just the safest move for the SEC to buy time until the 7 of October to appeal”.

It will be interesting to follow the news surrounding the case and see if it will have any impact on XRP’s valuation.

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