Coinspeaker XRP Leads Crypto Decline as Strong Dollar Pressures Bitcoin and Altcoins
Barely 48 hours to the end of 2024, the crypto market has taken a notable hit with XRP XRP $2.08 24h volatility: 5.0% Market cap: $119.25 B Vol. 24h: $4.06 B leading the lines in terms of losses. This follows after the coin dropped more than 5% of its value within the past 24 hours. It might be worth noting, however, that the force weighing Bitcoin (BTC) and the rest of digital assets as well as the Asian equity markets is a stronger US dollar. The overall crypto market capitalization has now decreased by 3%.
Like XRP, other major tokens, including Dogecoin DOGE $0.32 24h volatility: 1.8% Market cap: $47.23 B Vol. 24h: $2.26 B , Solana SOL $193.2 24h volatility: 1.7% Market cap: $92.64 B Vol. 24h: $2.90 B , Ether ETH $3 417 24h volatility: 0.4% Market cap: $411.49 B Vol. 24h: $17.78 B , and BNB, have also recorded losses. In fact, BNB BNB $694.6 24h volatility: 2.4% Market cap: $101.37 B Vol. 24h: $828.83 M also recorded losses as much as 2% before returning to gaining ways as of publication.
XRP and Entire Crypto Market Suffers amid Year-End Uncertainty and Dollar Strength
As earlier stated, one major reason for the present state of the crypto market is a stronger dollar, which comes ahead of President-elect Donald Trump stepping into office in late January. The US Dollar Index (DXY), which measures the dollar’s strength against major global currencies, is historically known to show a contrasting relationship with Bitcoin and other cryptocurrencies. This means that when there is a stronger dollar, traditional dollar-based investments like stocks and US Treasuries often become the go-to options for investors.
In such periods when this happens, investors prefer not to deal so much with riskier assets like cryptocurrencies. Hence, the current outlook of the market.
Moreover, there is also the fact that investors are generally more cautious at the present moment. That is, even across the broader financial markets as the year draws to a close.
This explains why the US equities declined on Friday as investors do their checks and balances ahead of 2025. Even on Monday, Asian equity markets also reversed their five-day gains, while futures contracts for the S&P 500 and Nasdaq also indicated losses in the upcoming US session.
As if the pressure on the crypto market is not enough, expectations for further Federal Reserve interest rate cuts have also reduced. This has contributed to the decline in Bitcoin and other cryptocurrencies over the past month.
Interestingly, it has been quite a unique December, quite against the “Santa rally” expectations. That is, considering that the period, which has historically been marked by bullish market activity, has not experienced the same this year. If no other evidence proves the uniqueness of this December, Bitcoin dropped nearly 4% this month. That is, despite its 47% gain in the final quarter of 2024, as CoinGlass data suggests.
Mixed Outlook for Crypto in 2025
It is interesting to note that the current market situation has still not been able to change the optimistic minds of some experts. For people like WeFi co-founder Maksym Sakharov, the long-term potential of cryptocurrencies remains intact.
Sakharov maintains that recent selloffs are merely impulsive reactions to a few uncertainties. However, these reactions will most likely be short-lived and do not mean that the much-anticipated crypto rally has come to an end.
The WeFi founder also noted that there are so many expectations for the Trump administration. That is, especially in the area of policies that will favour the crypto industry. This, he believes, will also attract more institutional investors and shine more light on cryptocurrencies in general.
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XRP Leads Crypto Decline as Strong Dollar Pressures Bitcoin and Altcoins
