In a remarkable turn of events, XRP, backed by Ripple Labs, has made a significant leap to become the third-largest cryptocurrency by market capitalization. This achievement came as XRP surpassed both Solana (SOL) and Tether (USDT) in a single day. The large-cap altcoin saw an impressive increase of over 25% in just 24 hours, reaching a price of approximately $2.4 during the early Asian trading session on Monday, December 2.
Currently, XRP boasts a market capitalization of around $140 billion, with a fully diluted valuation exceeding $240 billion. Furthermore, the altcoin experienced a 45% surge in daily average traded volume, amounting to about $23 billion at the time of this report.
Why Did XRP Go Up?
The recent surge in XRP’s price can be attributed to several key factors. As highlighted by Coinpedia, the cryptocurrency has benefited from the election of pro-crypto leaders in the United States, spearheaded by President-elect Donald Trump. The longstanding legal challenges stemming from the US Securities and Exchange Commission (SEC) charges are expected to be resolved once a new SEC chair is confirmed early next year.
One of the factors contributing to XRP’s rise is the significant liquidation of short traders. Data from Coinglass indicates that XRP’s leveraged market saw liquidations exceeding $50 million in the past 24 hours, with over $36 million involving short traders. This scenario has increased the likelihood of a short squeeze, further boosting XRP’s bullish momentum.
Moreover, on-chain data reveals heightened activity among whale traders, led by Ripple. For example, Ripple unlocked 1 billion XRP units from its escrow account and subsequently locked back over 800 million units. Meanwhile, several transactions involved whale investors withdrawing substantial amounts of XRP from exchanges such as Upbit and Binance.
What Next for XRP Price?
With a remarkable 280% surge in November, XRP has officially broken out of a multi-year triangular consolidation pattern. The veteran altcoin is now poised to retest its all-time high (ATH), which was set in 2018, following its 2021 bull cycle peak.
From a technical analysis perspective, XRP’s price has entered a highly anticipated parabolic phase, suggesting the potential for further gains in the coming months. The weekly Relative Strength Index (RSI) has surged above the 85% level for the first time since 2021, indicating that the bulls are firmly in control.
However, XRP traders should exercise caution, as a potential correction could occur following the massive bullish breakout. It is essential to be vigilant and prepared for potential fluctuations before the upward trend continues.
In conclusion, XRP’s recent surge to become the third-largest cryptocurrency by market capitalization marks a significant milestone for the altcoin. While the journey ahead may present challenges, the current bullish momentum suggests that XRP is well-positioned for continued growth in the cryptocurrency market.
