XRP braves SEC’s crackdown on cryptocurrencies sustains above $0.52
- The SEC’s lawsuit against Binance and Coinbase listed 12 and 13 crypto assets as securities, excluding XRP from the list.
- With XRP excluded from the “security” label, the altcoin sustained its weekly gains above the $0.52 level despite the SEC’s crackdown.
- The native token of XRPLedger noted 15.5% gains over the past two weeks.
The US Securities and Exchange Commission (SEC) cracked down on cryptocurrencies and labeled a dozen of virtual assets as securities. Despite the SEC’s lawsuit against payment giant Ripple, where the regulator alleges the firm of engaging in unregistered sales of securities, XRP did not make it to the SEC’s list.
Also read: Cardano, Solana TVLs hold up despite SEC security label
XRP price sustained above $0.52 despite the SEC’s crypto market shakedown
XRP price climbed from $0.4543 on May 25 to $0.5221 at the time of writing. Over the two-week timeframe, XRP yielded 15.5% gains, and sustained above the $0.52 level, despite the tumultuous events in the crypto ecosystem.
XRP/USDT one-day price chart Binance
The US financial regulator, SEC slammed the two largest cryptocurrency exchanges in the ecosystem, Binance and Coinbase with lawsuits. In these lawsuits, the regulator included a list of a dozen crypto assets and labeled them as securities, alleging that the platforms engaged in the sale of unregistered securities.
The SEC failed to mention XRP in this list and without the “security” label, the altcoin has survived what started as a market-wide bloodbath in the crypto ecosystem on June 5.
Why XRP’s gains are likely unsustainable
XRP holders rejoiced for two reasons, the altcoin was excluded from SEC’s carefully drawn list of assets that are labeled securities and the asset continued its upward climb through majority of the market-wide drawdown in crypto.
The altcoin’s gains are likely unsustainable in the long term as there is a considerable spike in the on-chain metric, social volume. There is a considerable increase in the mention of XRP in conversations across social media platforms like Twitter and this typically does not bode well for the asset’s price.
As seen in the chart from crypto intelligence tracker Santiment, there was a spike in social volume of XRP on four separate occasions, each followed by a price decline in the token.
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XRP social volume (blue bars) vs. price (green line) as seen on Santiment
On January 6, 14, 23 and February 12, there was a considerable spike in XRP’s social volume and the price nosedived each time. If history repeats itself, the XRP price could soon erase its gains from the past week or two and experience a pullback. The $0.50 level acted as key resistance for XRPLedger’s native token for several months, therefore, a decline below this level in the event of a correction would be a negative signal.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
