Although Ripple’s XRP is trading sharply lower today it is still 50% higher than it was a week ago.
In the regular world that is an impressive return but in crypto not so much, and especially so in XRP’s case after tripling its value over the space of a few days last week.
So was the run-up last Friday and the fall back since, basically a pump and dump? Who knows. More likely it is just typical momentum trading – buy on the way up, sell on the way down. In short then, we are partly seeing a bout of profit-taking. But that’s not the end of the story.
Yesterday, the Wall Street Journal reported that Ripple co-founder and founder of rival Stellar Lumens, Jed McCaleb has been selling his XRP (he has a lot), which is not exactly a vote of confidence in the token.
As the WSJ report is behind a paywall, here are the details about the selling:
“In July, Mr. McCaleb was selling 20,000 to 40,000 XRP a day. However, starting in August, according to a public clearinghouse of token trades, he started selling 499,312 XRP a day, and at one point sold 752,076 a day. In other words, each day he moved and sold about 35 times the limit outlined in his 2016 agreement with Ripple. For example, over six days ending Wednesday, Mr. McCaleb sold more than 500,000 XRP a day, or about $150,000.”
McCaleb came to an agreement with Ripple that he would only sell in accordance with a specific schedule and threshold.
The deal struck after an acrimonious dispute in 2014 means that McCaleb cannot sell without permission from Ripple Labs – he was granted 9 billion as a founder reward. Ripple Labs owns 60% of the total supply of 100 billion.
Expect some big xRapid news?
If XRP falls below $0.265 then it will be back where it started. That may happen but at this point seems unlikely given the news flow. For example next week sees the start of Ripple’s Swell by Ripple event starting on 1 & 2 October in San Francisco.
The event blurb describes the gathering’s purpose: “Swell, hosted by Ripple, connects the world’s leading experts on policy, payments and technology for the most provocative dialogue in global payments today.”
It would be highly surprising if Ripple didn’t announce more deals inked or in the pipeline. Speakers at Swell include President Bill Clinton, so this is a very high profile event.
Cuallix, Zip Remit, SBI Virtual Currencies, Mercury FX and the crypto exchanges Bittrex, Bitso and Coins.ph are known to be onboard as partners in Ripple’s xRapid – xRapid is the part of the Ripple product suite that actually uses XRP for liquidity.
Western Union has been playing with XRP since the beginning of this year, but it wasn’t impressed. WU claimed that they made no savings in their experiments with XRP.
If Ripple doesn’t make any significant announcements that the converse may be the case – the price of XRP will likely fall back to its starting point last week.
Best performers among top 50 crypto over 7 day’s. Prices at 14:27 UTC 25 September 2018 (source: coinmarketcap)