In the past few days, whales have been dumping large amounts of XRP to exchanges. At the same time, Ripple has rejected the amended offer from the U.S. Securities and Exchange Commission, sparking more concerns about its future.
Whales have been transferring large amounts of Ripple (XRP) to exchanges in the past few days. According to commentator MartyParty’s tweet, as many as 63,570,000 XRP have been transferred to exchanges since July 1.
This significant fluctuation indicates potential volatility in the market, as whales may be preparing for price fluctuations.
Whales dumping tokens?
The sudden influx of such a large amount of XRP into exchanges could overwhelm existing buy orders and drive prices down. This is especially true if there are not enough buyers prepared to absorb all the tokens at the current price. The market may experience even greater volatility as investors react to whale activity.
Some may see this as a selling opportunity and follow suit, leading to a snowball effect.
As of the time of writing, XRP is trading at $0.4789. The token’s price has dropped significantly after testing the $0.556 level on May 6.
During this period, there have been multiple lower lows and lower highs, indicating a bearish trend. The recent uptick in XRP price has not been enough to reverse or weaken this trend.
XRP’s Relative Strength Index (RSI) remains high, indicating a bullish momentum for the token. However, the significant recent drop in the Chaikin Money Flow (CMF) over the past few days suggests that funds flowing into XRP tokens have decreased.
The movement of XRP whales may be the result of declining investor confidence, sparked by Ripple’s handling of its case with the U.S. Securities and Exchange Commission.
Facing off against the U.S. Securities and Exchange Commission
The U.S. Securities and Exchange Commission initially cracked down on Ripple, demanding a hefty $2 billion fine for its alleged violations of security regulations. However, in a recent move, the regulatory agency softened its stance, proposing a significant reduction in the fine to $1.02 billion.
However, Ripple rejected this offer, as the company seems to believe it will win rather than settle. Nevertheless, the longer the case drags on, the more confidence investors may lose.
This is likely to have a significant impact on the future prospects of XRP.
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This move has also attracted criticism of the U.S. Securities and Exchange Commission, mainly because the regulatory agency is seen as stifling innovation in the cryptocurrency space.
Indeed, this legal dispute has proven to be costly for Ripple, as the company has already spent over $200 million to date.
