Shayan Chowdhury
XRP price has recently seen a price reversal as Ripple’s stablecoin announcement triggered intense buying pressure. Ripple, a blockchain service for businesses and the developer of the XRP Ledger, is launching its own stablecoin, which will be tied to the value of the U.S. dollar. Following this news, XRP price regained its momentum and is now aiming to meet its short-term bullish goals.
XRP Sees A Surge In Liquidation
Following the announcement that fintech company Ripple plans to introduce its stablecoin linked to the U.S. dollar on both the Ethereum and XRP Ledger blockchains, the price of XRP experienced a sharp rise. XRP’s value surged by 10% within an hour as a result of the news and subsequent buying activity in the markets.
Ripple’s decision follows the growing popularity of stablecoins among traders, who are drawn to these assets for their stability to the price fluctuations that affect major cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH).
The firm announced that the token, scheduled for release “later this year,” will be “fully supported by deposits in U.S. dollars, short-term U.S. government securities, and other forms of cash equivalents.” Initially, this stablecoin will be introduced on Ripple’s institutional-grade XRP Ledger as well as the Ethereum blockchain, adhering to the ERC-20 token standard of Ethereum.
At the beginning of the month and quarter, the entire market faced a downturn, with XRP also feeling the impact of this negative trend.
According to Coinglass data, XRP witnessed a total liquidation of nearly $2.85 million as the price of the altcoin dipped to its lowest in two weeks. The “Network Realized Profit/Loss” metric from Santiment highlighted that XRP investors have faced a loss of $25.67 million following the decline in price, suggesting a potential sell-off. However, the recent announcement might prevent the price from dropping further.
What’s Next For XRP Price?
XRP broke above EMA trend lines on the 4-hour price chart and touched the high of $0.617. However, sellers soon emerged and defended the level strongly, resulting in a minor correction. As buyers hold their momentum, traders might see another breakout attempt in the coming hours. As of writing, XRP price trades at $0.594, surging over 2.4% in the last 24 hours.
Despite this, the bears are not retreating and are attempting to halt a recovery rally as the price is expected to encounter resistance at the 100-day Exponential Moving Average (EMA) of $0.612. Should the price retreat from this barrier, the chances of falling below $0.56 become more pronounced. In such a case, the XRP/USDT trading pair might decline to $0.52.
Conversely, if the bulls manage to send the price above $0.61, it would indicate strong purchasing at lower levels. This could lead the price to surge towards $0.69 and potentially reach the critical resistance level at $0.74.
