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XRP Price Crashes After Coinbase Listing News — Long-Term Prediction Still Positive

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  • Jack Thomas
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    XRP managed to break the market downtrend on Coinbase listing news, but its price is starting to fall again — what’s going on?

XRP Price Crashes After Coinbase Listing News — Long-Term Prediction Still Positive
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Last weekend brought about a $1,000 price resistance break for Bitcoin for the first time in a long time. Unfortunately, it was short-lived as the major cryptocurrency’s price dove back towards $3,700 on Sunday.

The effect of Bitcoin’s price on the rest of the market was to be expected as the majority of coins mirrored its movements. However, one difference was with Ripple’s token, XRP. The third largest coin by market cap, XRP managed to bounce back from the market slump to reach similar heights to before the fall.

The basis for this spike was the announcement from Coinbase that XRP would finally find a place on the major US exchange for its Coinbase Pro users. Yet since that news has broken, the XRP price has started to fall again.

Still, even with its fall, the price of the coin is still up over 24 hours — nearly five percent — and in the long term, the prediction is that this announcement by Coinbase will keep it climbing.

Chart movements

For those that were watching the market intentionally after Bitcoin broke the $4,000 mark, they would have been disappointed to see that it was not able to hold that floor, and even more disappointed to see that it took most of the top ranked coins with it as it fell.

XRP went from $0.35 down to $0.30 in the fall that affected most of the market, but managed to hold onto that resistance point. After trading sideways for a while, the news of Coinbase Pro listing XRP broke and sent the coins skyrocketing back up to $0.346.

However, since that news has broken, the price has actually started falling again, rather than continuing on its upward trend. There are a few reasons for this, and some of it must be down to the lull in the market after the rally.

XRP Price Crashes After Coinbase Listing News — Long-Term Prediction Still Positive

Ripple is now around $0.326, which is still up from the general market collapse, and represents a five percent increase over 24 hours, but the question is what will happen next?

Long-term positivity

A Coinbase listing has been on the Ripple wishlist for some time now, and the fact that the exchange has made the first steps by announcing this for its Coinbase Pro customers shows good progress for investors in the cryptocurrency.

Ripple has been making many banking partnerships, and consistently has been growing that side of their business, but for the XRP token as a slightly separate entity, moves like this are helpful in legitimizing the token further within the cryptocurrency ecosystem.

This falling in price is nothing to be concerned about, as the volatility and price correcting after big news such as the Coinbase listing is to be expected. As volatility returns to the market, it indicates more trading volume, which in itself can lead to better price growth and prediction in the medium to long run.

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About the author

Jack Thomas is a journalist from Australia who has had a long career writing about finance and technology. He has combined his enthusiasm for these two subjects and applied his writing to covering blockchain and cryptocurrencies in the past few years.

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Federal Reserve System: Stablecoins Pose Potential Risks to Financial Stability

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  • Vladislav Sopov
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    According to its Financial Stability Report of November 2019, the Board of Governors has warned about the dangers of stablecoins.

Federal Reserve System: Stablecoins Pose Potential Risks to Financial Stability
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The Board of Governors of the U.S. Federal Reserve System have issued their monthly Financial Stability Report. This special report is dedicated to the profits and risks of "global stablecoins".

Stablecoins: Global System with So Many "Ifs"

First, the Federal Reserve admits to the numerous advantages that stablecoins present as a concept. It has been highlighed that stablecoins are "faster, cheaper, and more inclusive payments could complement existing payment systems". This is in comparison to cases where traditional financial institutions are sophisticated and poorly accessible. Stablecoins can also be managed to eliminate the volatility of cryptocurrencies, which is one of the borders for them to be utilized as the medium for exchange.

Therefore, the "global stablecoin initiatives" like Facebook's Libra can rapidly achieve cross-border adoption. However, the major threat for stablecoins is apparent - the "inability to convert in national currency". The loss of confidence in "pegging" the stablecoin to traditional assets can lead to a run, in which several holders will attempt to liquidate their stablecoins at the same time.

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This dramatic scenario may be caused by "poor design and governance", and can result in severe consequences for international economic activity, asset prices, and financial stability.

Transparency First

The Federal Reserve also outlined in its report that in many cases, stablecoins can be utilized for money laundering, terrorist financing, and other financial crimes. Therefore, the Federal Reserve would require operators of such systems to conduct their Due Diligence, as well as Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures to avoid any abuse. Moreover, the problems of disclosure policy and protecting investor data should be of paramount importance for stablecoin issuers:

Disclosures should clearly detail consumer and investor rights and protections, including whether the holder of the stablecoin has any rights to the underlying asset. Issuers should be transparent on how the stablecoin is tied to the underlying asset, has been said in the Report.

Last but not least, the report highlighted that the Federal Reserve, together with the Group of Seven, will closely monitor stablecoin developments as well as all the risks associated with it.

Have anyone ever invested in stablecoins? Do you prefer to use it, or to pay extra fees for fiat gateways? Tell us your story on Twitter!

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About the author

 Blockchain Analyst & Writer with scientific background. 5+ years in IT-analytics, 2+ years in blockhain. Worked in independent analysis (Crypto Briefing) as well as in start-ups (Swap.online, Monoreto, Attic Lab etc.)

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