XRP, the currency that runs on the digital payment platform RippleNet, hit $1 on Tuesday morning EDT, becoming the fourth highest-valued cryptocurrency with a $45.5 billion market cap despite being sued by the U.S. agency that works against market manipulation.
After rising as high as $1.12, XRP was trading at $0.96 as of this writing, with a $43.567 billion market cap — still ranked at No. 4 by CoinMarketCap, before slipping down to fifth place after Tether.
The U.S. Securities and Exchange Commission sued Ripple Inc. in December for failing to register as a security and raising $1.3 billion by selling the token in unregistered securities offerings.
Hitting above $1 was the highest the cryptocurrency has climbed since March 2018. XRP fell from around $0.60 in November 2020 to $0.20 in December, Coindesk reported. It hit an all-time high of $3.30 in January 2018.
Observers say the token may be getting price support from the XRP community, aka the XRP Army.
“They are still purchasing, they are still trading,” CoinDesk’s Ben Powers said, describing the “tribalism of crypto. You know, like people have their camps, and they rep them hard. The SEC can take action, but these are currencies that go beyond just the reach of the U.S.”
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XRP holders have become confident in the digital asset and managed to push it above several important resistance levels, but there is intense pressure to sell, FXStreet reported. The MVRV (market-value-to-realized-value) ratio, a metric that shows the average profit or loss of XRP tokens moving in the past 30 days, has entered the danger zone above 40 percent, which usually indicates a significant correction is coming.
Over the weekend, Ripple won the right in the lawsuit to keep its private emails from going public, but it’s unclear if this was the only reason for the price jump, Newsweek reported.
The No. 1 and No. 2 cryptocurrencies Bitcoin and Ethereum are not treated as securities by the SEC because they are decentralized — not controlled by a central entity. Both are gradually minted over time in the mining process, with cryptocurrency enthusiasts essentially creating tokens using computing power.
However, all 100 billion XRP tokens were created simultaneously by Ripple in 2012. Ripple also controls a large portion of the existing XRP tokens, adding to the debate about whether or not it is decentralized.
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