The cryptocurrency market experienced massive volatility last week, with most trading in the red. Some altcoins, such as XRP, have experienced a massive decline, losing more than 17% in the last seven days. 📉
There are several reasons behind the decline of XRP. First, since Bitcoin's market cap makes up a large portion of the cryptocurrency market, when Bitcoin falls it drags other cryptocurrencies along. Since XRP's market cap is smaller than Bitcoin, its value may decrease with lower selling pressure. Panic sales affect XRP more. 😰
Another factor is specific to XRP; Ongoing litigation with the U.S. Securities and Exchange Commission (SEC). Investors, especially institutions, are wary of XRP due to allegations that the SEC considers XRP to be a security. Although the outcome of the case is still uncertain, the recent partial victory for Ripple is promising.
The big question is when the XRP price will recover. Regulatory developments and SEC litigation will have a major impact on the price. Additionally, technological developments within the Ripple ecosystem may also help the XRP price return to its previous levels. Overall market sentiment will also play an important role.
From a technical perspective, there is very strong support at $0.42. This support appears to have prevented the market from falling further in the recent decline and could provide a foothold for a potential future rally.