The crypto market is experiencing worrying volatility, with Bitcoin leading the decline. This has impacted other major cryptocurrencies, including XRP, which fell over 11.6% to $0.3823, its lowest price point level since March 2023.
In response to community concerns, Ripple's chief technology officer, David Schwartz, addressed the price of XRP. Schwartz reportedly focused on the utility aspect, stating that the current price allows users to acquire enough XRP to facilitate a $1 payment for just $1 worth of it.
XRP to USD by CoinMarketCap
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Still costs $1 to buy enough XRP to make a $1 payment.
— David "JoelKatz" Schwartz (@JoelKatz) July 5, 2024
This suggests a focus on XRP's functionality as a medium of exchange despite the broader market downturn, rather than an investment asset. If someone forgot, its utility lies in facilitating fast and cost-effective cross-border transactions.
What's going on?
The current market weakness can be attributed to several factors, including large liquidations, institutional selling pressure from ETFs and governments, and ongoing uncertainty surrounding the Mt. Gox repayments.
These factors have created an environment where excessive selling volume exceeds market liquidity, leading to extra painful price declines.
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Some experts predict a potentially prolonged bearish period due to the confluence of negative factors. Investors, those of XRP too, should be prepared for a slow recovery as market sentiment remains cautious.
On the other hand, Schwartz's perspective suggests that while short-term volatility may impact prices, the long-term viability of cryptocurrencies like XRP hinges first on their practical applications.