XRP, the native token of the XRP Ledger network closely linked to Ripple, surged to a six-year high on Wednesday as bitcoin (BTC) rose to $100,000, with traders encouraged by this morning’s much-anticipated US CPI inflation data report.
The token briefly topped $3 during the early US trading session for the first time since early January 2018, before paring a small increase. Recently changing hands at $2.95, it was up 11% over the past 24 hours, outpacing bitcoin’s (BTC) 3.6% and the broad market benchmark CoinDesk 20 Index’s 6.7% gain over the same period.
XRP has been among the top performing tokens with a 488% increase since Donald Trump’s election victory. It has now become the largest cryptocurrency by market capitalization behind BTC and Ethereum’s ether (ETH), reclaiming its third position from Tether’s USDT stablecoin. With a market cap of $170 billion, the token is now larger than the market cap of asset management giant BlackRock (BLK).
The gain was driven by anticipation of crypto-friendly policies and an overhaul of digital asset regulation in the US. The Securities and Exchange Commission (SEC) and Ripple have been in a legal battle for years over the sale of XRP tokens.
“This increase is driven by a growing number of partnerships, the launch of Ripple’s stablecoin RLUSD and speculation about a potential spot XRP ETF,” said Diego Cardenas, OTC trader and at digital asset platform Abra, in a note shared with CoinDesk. Ripple president Monica Long said in an interview last week that she expects a spot ETF to be approved “very soon” as approvals with the incoming administration will accelerate.
XRP also broke out of the consolidation pattern that started in early December, as CoinDesk market analyst Omkar Godbole noted last week, paving the way for the next leg of the token’s rally. Another 15% increase from current prices would mean new records above the 2018 January peak of $3.4. Still, adjusted for inflation over the years, XRP needs to exceed $4.24 for a new high, Galaxy head of research Alex Thorn said in an X post.
Accumulation of XRP tokens by large investors over the past two months may also fuel the surge towards new records.
Research firm Santiment noted that addresses with between 1 million and 10 million tokens increased their holdings by 1.4 billion coins — worth about $3.8 billion — since November 12, continuing the accumulation as prices consolidated after peaks in early December.
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