Key Points
- XRP’s value dropped by 7% this week, amidst a significant period for digital assets.
- President Trump’s crypto czar, David Sacks, is focusing on clearer regulation for stablecoins, potentially benefiting Ripple’s RLUSD.
XRP has seen a decline of 7% since the start of the week. This comes at a time when digital assets are in the spotlight, with President Trump’s crypto czar, David Sacks, holding a press conference and declaring this as a “golden age in digital assets.”
Sacks’ main focus is to establish clearer regulation for stablecoins. This development could potentially benefit Ripple’s RLUSD.
Factors Influencing XRP
The price of XRP is usually affected by a few factors. These include the lawsuit against Ripple by the U.S. Securities & Exchange Commission, the adoption and partnerships of RLUSD stablecoin, and developments in the XRPLedger.
David Sacks, the U.S. Crypto Czar, has prioritized stablecoin legislation. During his first press conference this week, Sacks outlined his plans for ushering in a golden age in digital assets and cryptocurrencies. This could potentially benefit XRP holders and trigger a recovery for the altcoin.
XRP’s value decreased by almost 7% from Monday’s opening price of $2.5801 to $2.4060. Sacks has set a six-month timeline for stablecoin regulation, making it a top priority.
Ripple’s RLUSD has recently announced several partnerships with crypto exchanges and institutions. The stablecoin RLUSD is now available on 14 exchanges, including Archax, Bitso, Bitstamp, Bullish, B2C2, Coinmena, Independent Reserve, JST Digital, Keyrock, MB, Moonpay, Revolut, Uphold, and Zero Hash.
Ripple Lawsuit and On-Chain Metrics
The SEC lawsuit against Ripple in 2020 resulted in some partial victories for the payment firm. These victories have contributed to gains in XRP’s price.
Ripple’s on-chain metrics, such as total funding rates aggregated by XRP across exchanges, indicate a potential recovery in the coming week. The funding rate turned positive on Friday after three consecutive days of negative funding rates.
The total value of assets locked on the XRPLedger remained above $80 million, according to DeFiLlama data. This is an indicator of investor confidence and relevance of a blockchain, and contributes to a bullish thesis for XRP.
Technical Analysis and Correlation with Bitcoin
XRP began its downward trend on January 16. At the time of writing, it trades at $2.3986. The RSI on the daily timeframe points to a bullish thesis for XRP, reading 37 and sloping upwards.
The three-month correlation between XRP and Bitcoin (BTC) is 0.83, according to Macroaxis data. This high correlation implies that XRP’s price moves in response to Bitcoin’s, and a crash in BTC can drag down the altcoin. Traders should be aware of this correlation and monitor the Bitcoin price chart closely to anticipate volatility in XRP’s price.
The long/short ratio for XRP is greater than 1 on key exchanges like Binance and OKX, suggesting that derivatives traders maintain a bullish stance on the altcoin. Options open interest has not seen significant change in the last 24 hours and hovers above $3.6 billion.
