Hey guys! Let's look at what is happening in the cryptocurrency market right now. XRP, Ripple's token, has overtaken Tether (USDT) and returned to third place by market capitalization. This is a big event for the crypto industry, and here's why.
XRP Is Back in the Top Three
To date, XRP's market capitalization has grown to $140 billion, surpassing USDT, which is valued at $137 billion.
XRP has risen in price by 15% in the last seven days, and by 350% in a year. This growth has led to a redistribution of forces in the top 3 largest cryptocurrencies: now only bitcoin and ether remain ahead of XRP.
Why Is XRP Growing?
The growth of XRP is explained by several factors at once:
1. The launch of Ripple USD (RLUSD)
In December, Ripple Labs released its stablecoin, Ripple USD (RLUSD), which is fully backed by US dollars. This has increased confidence in the Ripple ecosystem and attracted new investors.
2. Waiting for the approval of the ETF
The U.S. Securities and Exchange Commission (SEC), led by crypto-friendly chairman Paul Atkins, may approve an exchange-traded fund (ETF) based on XRP.
WisdomTree and Bitwise have already announced their plans to launch an XRP-based ETF.
If the ETF is approved, it will attract large institutional investors.
3. Trust in Ripple after winning in court
Ripple won an important case against the SEC in 2023. This strengthened its position in the market and made XRP more attractive for long-term investments.
Why Is Tether Losing Ground?
USDT, the world's largest stablecoin, has faced a number of challenges that have negatively affected its market capitalization.
1. Regulation in the EU (MiCA)
On December 30, strict rules governing cryptocurrencies (MiCA) came into force in the European Union.
On January 2, Tether's market capitalization dropped by 1.2%.
Since then, total losses have totaled $1.6 billion.
Tether does not comply with the new MiCA rules, which forced exchanges to restrict its use in Europe.
2. Exclusion from Coinbase
On December 13, the largest US cryptocurrency exchange, Coinbase, announced that it would exclude USDT from its listing. This decision is also related to Tether's non-compliance with new regulatory requirements.
3. Old transparency issues
Tether has long been criticized for the lack of transparency of its reserves. Investors doubt that the company really has 100% collateral for all issued USDT.
Can Tether Come Back?
Despite the difficulties, Tether remains an important player in the market.:
80% of the USDT trading volume is in Asia.
This region remains a key one for Tether, which allows the company to compensate for losses in Europe.
Tether can strengthen its position if it resolves transparency issues and adapts to new regulatory requirements.
What does this mean for the Market?
Increasing competition among stablecoins
The launch of RLUSD and other alternatives could weaken Tether's monopoly.
The importance of regulation
The European MiCA laws show how much regulation can affect the cryptocurrency market.
Interest in XRP will continue to grow
If an XRP-based ETF is approved, it will be a new incentive for growth.
XRP is back in the top three, showing that the crypto market remains dynamic and unpredictable. While Ripple is celebrating success, Tether is preparing to fight to regain its position.
What do you think about this? Is XRP a new market favorite, or is Tether still capable of surprising?
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