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In a remarkable show of resilience amid a broadly weak cryptocurrency market, XRP is up 6.7% over the past 24 hours. After falling to a low of $1.90 on December 10, the asset is once again trading above $2.36, defying the prevailing bearish sentiment that has gripped the altcoin sector.
While most altcoins posted losses or traded sideways over the same period, and Bitcoin posted only a modest gain of 0.7%, XRP’s recent outperformance stands out as a clear anomaly. So, why is XRP outperforming the cryptocurrency market?
#1 The imminent launch of Ripple’s stablecoin RLUSD
The main catalyst behind the XRP rally appears to be the imminent launch of Ripple’s long-discussed stablecoin, RLUSD. Yesterday, Ripple CEO Brad Garlinghouse certain Via X that RLUSD received pivotal regulatory approval. He said: “We just got final approval from NYDFS for RLUSD! Exchange and partner listings will be published soon – and a reminder: when RLUSD is published, you’ll hear it from Ripple first.”
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RLUSD, which is currently undergoing beta testing on both the Ethereum network and the XRP Ledger (XRPL), has sparked enthusiasm within the XRP community. Members anticipate that the introduction of a stablecoin could stimulate increased liquidity and utility for XRP, and the anticipation may contribute to increased speculative interest and so-called “FOMO” (fear of missing out).
#2 Strong on-chain XRP activity
On-chain analysis from Santiment indicates encouraging metrics for XRP. Company male “The average lifetime of a dollar investment is flashing a bullish signal,” highlighting that lifetime distributions of younger currencies often precede sustained rallies.
According to Santiment, the average age of investing in XRP is 865 days (22% younger at 14 weeks). Consequently, activity on the XRP network is increasing, with historically similar patterns not reversing until these key indicators begin to reverse.
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“This is one of the key indicators throughout each coin’s life history that helps verify that a bull market can and should continue. Likewise, the bull markets in 2017 and 2021 did not stop until the average lifespan of assets started to rise (age) again.” “Although it is possible to continue to expect price fluctuations in the short term, consider this a very valuable indicator of confidence if you remain optimistic about market prices in the medium and long term,” says Santiment.
#3 Whales are buying the dip amid a bullish technical setup
Technically, the price structure of XRP remains very bullish on higher time frames. On the daily chart, XRP managed to hold support above the April 2021 high at $1.96, and quickly rebounded towards the 1.272 Fibonacci extension level near $2.42, where it is currently hovering. A sustained break above $2.42 could reinforce the bullish narrative.
It is worth noting that whales recognized the opportunity and bought the bounce. Cryptocurrency analyst Ali Martinez male Via X: “In the recent dip, whales bought over 100 million XRP!”
Featured image created with DALL.E, a chart from TradingView.com
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