XRP Ledger Activity Plummets 90%: What’s Behind the Sudden Drop?
In a concerning turn of events, the XRP Ledger has witnessed a staggering 90% decline in on-chain activity from its recent peak, sparking fears about the network’s usage and overall health. According to a report by U.Today, the volume of payments and transactions on XRP Ledger has virtually vanished, despite XRP’s price remaining relatively stable between $2.30 and $2.40. This sudden drop raises questions about the future of XRP and whether it can regain its momentum.
The decline in XRP Ledger activity is particularly worrying, as it suggests that speculative interest is significantly outpacing actual usage. As noted by U.Today, "this change in sentiment is technically reflected in the price action of XRP." The cryptocurrency’s price action has been lacklustre, with XRP struggling to break out of a tightening consolidation pattern. At $2.30, the price is testing a support zone that coincides with the 100-day EMA. A slip below this level could see XRP fall to $2.20, or even as low as $2.05, according to U.Today‘s analysis.
Technical indicators also suggest that XRP’s momentum is slowing. The Relative Strength Index (RSI) has fallen to the mid-50s, indicating that the cryptocurrency is not yet oversold but is losing steam. Furthermore, volume has significantly decreased, highlighting the possibility of a further decline if support breaks. As U.Today notes, "a number of reasons" are behind the decline in XRPL activity, including a halt in speculative trading volumes, decreased institutional usage due to ongoing regulatory uncertainty, and the dominance of Bitcoin, which is sucking liquidity away from altcoins like XRP.
The sharp drop in payment volume on the XRP Ledger is a concerning sign, as it could be attributed to either a lull in retail demand or decreased enterprise usage – two factors that are essential to XRP’s central story as a payments token. As U.Today emphasises, investors should now keep a careful eye on the $2.20 and $2.30 support zones. If XRP bounces from these levels, it might retest the $2.50 breakout point, but a breakdown would expose it to a much deeper retracement.
According to U.Today, XRP must demonstrate that it can spark real-world transactions again, or risk seeing its price action follow the on-chain trend. With 90% of its usage volume having been used up, the stakes are high for XRP to regain its momentum. As the cryptocurrency market continues to evolve, it remains to be seen whether XRP can adapt and recover from this sudden drop in activity.
The XRP Ledger’s decline in activity is a timely reminder that the cryptocurrency market is highly unpredictable and subject to sudden changes in sentiment. As U.Today notes, the dominance of Bitcoin is a significant factor in the decline of altcoins like XRP. However, it is also worth noting that XRP has shown resilience in the past, and some analysts remain optimistic about its long-term prospects. As the situation continues to unfold, one thing is certain – investors will be keeping a close eye on XRP’s price action and on-chain activity to gauge the cryptocurrency’s future direction.
The source of this article, U.Today, has provided in-depth analysis of the XRP Ledger’s activity and its implications for the cryptocurrency market. Their report highlights the need for XRP to demonstrate real-world usage and transactions to regain its momentum. With the cryptocurrency market continuing to evolve, it will be interesting to see how XRP adapts to the changing landscape.
This article is based on information provided by U.Today: https://u.today/90-xrp-ledger-drop-whats-about-it.
