XRP, a token linked to Ripple Labs, has vaulted rivals to become the third-largest cryptocurrency in a US$100 billion rally.
The token rose as much as 32 per cent on Monday (Dec 2) to US$2.87. In the process, its market capitalisation topped US$154.6 billion, up from less than US$30 billion on Nov 5, when Donald Trump emerged victorious in the US presidential election, according to CoinGecko data.
The latest price spike was driven by continued overseas buying, primarily in South Korea, as well as short liquidations on futures exchanges, according to Edward Chin, co-founder of Parataxis Capital. About US$60 million in XRP short positions were liquidated in the last 24 hours, which was more than short liquidations for Bitcoin and Ether combined.
“The move seems to be entirely retail-driven as nothing has fundamentally changed for XRP itself,” Chin said. “The move looks to be excessive given XRP is now a top-three digital asset, but that doesn’t mean that it can’t continue given the reflexivity in this market.”
The latest price move continues to build on the momentum from Trump’s win, which sparked a wave of speculative enthusiasm across crypto markets, with the president-elect expected to make good on pledges to nurture a favourable landscape for digital-asset firms in the US. Even against that backdrop, XRP’s rally is striking: in recent weeks its market value has surpassed that of rivals Solana and USDT, Tether’s stablecoin, the CoinGecko data show.
Ripple Labs was sued in 2020 by the US Securities and Exchange Commission, which claimed the San Francisco-based company broke the law when it raised money by selling XRP without registering it as a security.
The agency under chair Gary Gensler later brought lawsuits against numerous digital-asset firms including Coinbase Global and Binance Holdings. On the campaign trail, Trump had vowed to fire Gensler, who now intends to step down in January on the day the president-elect is due to be inaugurated. Trump has vowed to put in place friendly regulators and also backs the creation of a US strategic Bitcoin stockpile.
The crypto market has gained about US$1.2 trillion in market value since Trump’s election victory, CoinGecko data show.
Market leader Bitcoin, which last month came close to US$100,000 for the first time, traded at US$95,760. Ether, the second-largest token, changed hands at US$3,613. BLOOMBERG
