- Regulators are trying to tell truly decentralized assets apart from those that can be manipulated.
- BTC/USD and XRP/USD in danger of bigger drops.
USA regulators are taking a close look at Ripple Labs Inc., a company specialized in Blockchain-related technologies and applications. Their most known product is the Ripple cryptocurrency, which is being looked at due to an apparent lack of decentralization and possible use as a cover to fund the company.
According to the regulators, Ripple's developing company keeping a significant amount of all tokens, and therefore being able to affect its price, makes it closer to a stock than an asset. Being so, Ripple Labs Inc. should be subject to the same regulations as any enterprise trying to get liquidity or capital monetization.
Comparing Ripple to Bitcoin, the main cryptocurrency is fully decentralized, with all operations being peer-to-peer and without any central node being able to affect the price. Holders are buying Bitcoin based on its intrinsic value and with full conscience of this fact. Ripple, on the other hand, can be used as a stock, as its price can change due to external factors decorrelated with how much a person may be willing to pay for it.
Any experienced stock investor has suffered from decisions taken by the Board of Directors: capital increases, splits, stock price control, dividend control, etc. In almost all cases, these actions favor majority shareholders, while small investors tend to pay for it. This situation is what regulators are trying to impede.
BTC/USD 120 min
The European session has awakened with new Bitcoin drops that have taken it to $6,571. There is an important support at $6,456, April minimums. If lost, the next defense would be around $6,000 to $5,900. Above, an expected upwards turn would face the EMA50 and channel roof at $7,000, followed by a price resistance at $7,300.
The 120 min MACD shows a bearish profile with a lack of amplitude that is good for the price, since signals weakness in the current trend. Still, the chart is quite complicated and, if loses keep going, the MACD could gain amplitude and open the door to bigger drops.
The Directional Movement Index looks bad but is actually following the classical pattern of an ADX retest from below the Directional that has crossed the ADX the last.
XRP/USD 120 min
Ripple keeps its feeble bearish trend, with prices trickling constantly in a SmallCap style chart. It is now at $0.4680, in the lower range of a price zone that has kept it since late March. This level and the upper bound $0.50 are key for any continuation or change in the price.
The 120 min MACD shows a similar structure to BTC/USD, so the analysis is the same. The only difference is a wider separation between lines and the 0 than Bitcoin's.
The Directional Movement Index is different to BTC's, with the D- above the ADX, a setting that favors more drops. The ADX is flatter in Ripple, with a value of 19.44, slightly below the trend confirmation threshold.
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