The XRP digital asset, recently rebranded by Ripple Labs, Inc., has continued its crash, causing a “flippening” with Ethereum (ETH). The swapped positions based on market capitalization are not due to a spike in ETH prices – on the contrary, ETH is also sliding, reaching levels not seen since the summer of 2017, having wiped out most of its gains.
But the crash of XRP is deeper, as the hopes of trading on Coinbase have been dashed. Additionally, a recent lawsuit was dismissed by the US Northern District of California. The lawsuit has, at its heart, the biggest problem with XRP.
The plaintiff, Ryan Coffey, claimed he suffered financial losses after Ripple Labs, Inc. used disproportionate promotional events, and in effect mis-represented the role and nature of the XRP digital asset. In a note, the court dismissed the motion.
However, similar criticisms were the chief source of pessimism for XRP holders. After the rebranding, it became even clearer that the XRP digital asset was not meant to participate in some of the plans of Ripple to achieve frictionless interbank transactions.
The news gained momentum and current investors realize that actually holding XRP may not be useful at all. The asset is not a security, giving no right to ownership of the Ripple ecosystem. Additionally, the asset is also not promising future utility, as the Ripple network can transfer funds without the need for XRP coins. Hence, XRP was probably created as a way to popularize the project.
The continued pessimism saw XRP slide to $0.30, down 28% net in the past week.
Trading volumes dwindled to $196 million, and prices fell both in dollar and BTC terms. XRP has been sold off in all the pairs, including Japanese Yen, Korean Won, but also BTC and Tether (USDT). XRP has lost more than 91% of its value since the peak, and is among the most depressed digital assets. The hopes of a $5 price after mass adoption turned out to be one of the most unrealistic predictions in the world of crypto assets.
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