The market capitalization value of Ripple (XRP) has increased, but it risks being surpassed by Dogecoin (DOGE) if both cryptocurrencies maintain their current performance. In the past 24 hours, XRP's price has increased by 5.20%, while DOGE surged by 22%.
If this trend continues, DOGE's rapid growth rate could help it narrow the market capitalization gap between the two cryptocurrencies. The outcome also depends on whether XRP can maintain or accelerate its price increase.
Low Activity of Ripple Puts Its Position at Risk
The market capitalization of XRP has increased to $30.63 billion and remains the 7th most valuable cryptocurrency. In contrast, Dogecoin ranks eighth with a value of $30.26 billion. To clarify, market capitalization is the product of price and circulating supply.
Since both DOGE and XRP have a total supply in circulation, their prices determine market capitalization growth. Therefore, if XRP's price continues to lag behind DOGE's pace, it may fall behind this Meme Coin.
Notably, XRP's price increase may be linked to a broader market recovery. But for DOGE, growth depends on increased market interest and Elon Musk's continued support for Donald Trump through the Government Efficiency Department (D.O.G.E) posts.
XRP market capitalization compared to Dogecoin. Source: Santiment
With Donald Trump expected to be declared president, Dogecoin is likely to continue its upward trend, capitalizing on the increased sentiment driven by his favorable stance towards cryptocurrencies. DOGE's potential surge could put additional pressure on XRP, causing it to fall behind.
Another metric indicating that XRP may underperform compared to DOGE is the Average Investment Age (MDIA). MDIA is the average age of all tokens on a blockchain calculated by purchase price.
When this index decreases, it means that most tokens are no longer stagnant, and prices may rise. However, in this case, the index is increasing, indicating low trading activity and making it difficult for prices to rise.
Average Investment Age of XRP. Source: Santiment
XRP Price Analysis: Altcoin Overbought
A look at the 4-hour chart shows that the Bollinger Bands (BB) are expanding, indicating strong volatility around this cryptocurrency. However, the upper band of the indicator has touched XRP's price at $0.54.
When the upper band of the BB touches the price, it means the asset is overbought. If the lower band does the same, the asset will be considered oversold. Since this is the former case, it means XRP's price could revert to $0.51.
4 Hour Analysis of XRP. Source: TradingView
If this happens, XRP's market capitalization could lag behind DOGE if the latter's price increases. On the other hand, a breakout above the resistance level of $0.55 could invalidate this forecast. In that scenario, the altcoin could jump to $0.60.
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