Crypto Alarm: XRP’s Trade Volume Plunges to Six-Year Low, a Cause for Concern?
A significant decline in XRP’s daily trading volume has raised concerns among investors and analysts. On Thursday, XRP’s trade volume dropped to levels not seen in the past six years, which has caught the attention of crypto enthusiasts.
Bill Morgan, a reputable lawyer and XRP advocate, took to X (formerly Twitter) to address this worrisome trend pointed out by WrathKahneman. According to WrathKahneman, XRP’s trading volume on December 21 was approximately 1.9 billion, significantly lower than the $2.4 billion observed in 2022 and a drastic decrease from the $19.3 billion recorded in 2020.
This decline has sparked a debate over the implications for XRP’s market dynamics and investor sentiment. However, it is crucial to note that this trend is not exclusive to XRP alone. Leading cryptocurrencies like Bitcoin and Ethereum are also experiencing similar plunges in trade volumes. This broader market trend suggests a potential shift in trading activities across the crypto landscape.
Media reports support Mr. Huber’s assertion, stating that Bitcoin’s trade volume reached its lowest point in four years as of August 28, 2023. This pattern seen across multiple major cryptocurrencies indicates a more complex market dynamic that extends beyond XRP.
Despite the concerns regarding trading volume, XRP has shown resilience in its market price. Over the past 24 hours, the digital asset has seen a nearly 1% increase, with its trading price hovering around $0.61.
Although it experienced a 4.6% decline in the past two weeks, XRP’s performance over the past month displays a 3.8% increase. Currently, its trading volume continues to decline, standing at approximately $1.3 billion, maintaining a relatively steady state compared to last Friday’s $1.2 billion.
Furthermore, another user, MoonLambo on X, supports Mr. Huber’s observation that the downturn in trading volume is not unique to XRP. Responding to Bill Morgan’s post, MoonLambo asserts that the plunging trading volume is not concerning or unusual. They argue that focusing on just six specific days’ data out of around 2,200 over the past six years is too limited to draw meaningful conclusions.
According to MoonLambo’s analysis of the all-time XRP/USD price chart, they note a consistent pattern where both XRP’s price and trade volume increase as market activity heats up, a pattern observed consistently over a decade for XRP, as well as other major cryptocurrencies like BTC and ETH. MoonLambo expects a significant increase in trade volume when XRP experiences its next market rally.
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