XRP’s value faced downward pressure this week, nearing bear market territory, even amid significant developments in its ecosystem, particularly the recent IPO of Bullish, the cryptocurrency exchange endorsed by Peter Thiel.
Summary
- XRP’s price fluctuated following Bullish’s announcement of utilizing RLUSD for its IPO proceeds.
- RLUSD’s market capitalization surged past $666 million, with its monthly trading volume reaching $2 billion.
- Ripple’s price formation has illustrated a cup-and-handle pattern, suggesting potential upward movement.
Ripple’s XRP dipped to a notable support level of $3, marking a 17% decline from its peak this year. The cryptocurrency’s market capitalization has decreased from approximately $200 billion to $179 billion.
Bullish Chooses RLUSD for IPO Funding
Bullish revealed that it opted to receive the $1.5 billion proceeds from its recent IPO in stablecoins. Predominantly, these proceeds were in Circle’s USDC, with an additional portion acquired through Ripple USD (RLUSD) alongside other stablecoins, including PayPal’s PYUSD and regulatory-compliant USD1 issued by World Liberty Financial. According to David Bonanno, Bullish’s CFO:
“We recognize stablecoins as one of the most transformative use cases for digital assets. Our collaborations with issuers reflect how Bullish’s robust infrastructure and liquidity support these businesses.”
Ripple’s RLUSD has rapidly ascended to become one of the leading stablecoins in the market. Since its launch last December, it has witnessed a market cap exceed $666 million and a remarkable daily trading volume that surpassed $171 million.
Data from Artemis indicates a staggering 99% increase in the volume of RLUSD, which soared to $2.6 billion over the past 30 days, even as transaction counts decreased by 14% to 416,000.
RLUSD is poised to take advantage of the recently enacted GENIUS Act in the U.S., which aims to provide regulatory clarity for stablecoins. This regulatory environment is anticipated to drive more adoption and use cases, thus positively impacting XRP’s price through increased transaction fees and a reduced circulating supply due to XRP burning.
In the past month, the amount of stablecoins in circulation, particularly RLUSD, has surged by 30%. Analysts predict this trend could continue as RLUSD gains further traction in the market.
Additionally, Ripple has been actively strengthening its footprint in the stablecoin sector. Earlier this month, it acquired Rail, a platform dedicated to stablecoin-fueled global payments, with the ambition of crafting a comprehensive stablecoin payment solution.
Technical Analysis of XRP Price
Technical indicators reveal that XRP has formed two promising patterns on the daily chart, suggesting a possible bullish breakout. The coin displays a cup-and-handle formation, a typical pattern associated with upward price movement, comprising a rounded bottom followed by a consolidation phase resembling the “handle.”
Upon closer inspection, this handle bears similarities to an inverse head-and-shoulders pattern, further supporting the potential for future gains.
XRP maintains its position above the 50-day and 100-day Exponential Moving Averages, which serve as essential support levels. Consequently, the token is positioned for a substantial bullish breakout, potentially targeting the psychological level of $5.2. However, any drop below the head section at $2.7 could invalidate this optimistic forecast.
