XRP has been one of the worst performing major cryptocurrencies throughout 2019, as it struggled to gain the upwards momentum seen by Bitcoin in the early half of the year, while underperforming BTC during its downtrend during the second half of the year.
This bearishness may spill over into 2020, as the cryptocurrency’s fundamental strength is incredibly weak at the moment and could lead the crypto to see significantly further downside in the near-term.
XRP Facing Significant Controversy That May Continue Hampering its Price
Currently, XRP is trading up just over 1% at its current price of $0.193, which marks a slight climb from its daily lows of just under $0.19 that were set in tandem with Bitcoin’s fleeting dip to just over $7,000 yesterday.
XRP is currently trading down roughly 45% from where it started 2019, and it has shown few signs of having any underlying bullishness throughout the past year.
The main source of this bearishness has been the controversy surrounding the token’s close ties to the San Francisco-based FinTech company Ripple, who has been conducting quarterly sales of the token that has been pinned as one source of the downwards pressure the crypto has seen throughout 2019.
Just yesterday, Twitter was set ablaze by another round of Ripple XRP sales, with 200 million XRP – worth over $38 million – being moved from the company’s escrow account.
“200,000,000 #XRP (38,116,032 USD) transferred from Ripple Escrow wallet to Ripple,” WhaleAlert noted in a recent tweet.
🚨 🚨 🚨 200,000,000 #XRP (38,116,032 USD) transferred from Ripple Escrow wallet to Ripple
— Whale Alert (@whale_alert) December 31, 2019
Mati Greenspan, founder of QuantumEconomics, explained in a recent tweet that XRP’s token economics is not conducive to it seeing any bullishness.
“XRP tokenomics is a bit funny that way. The two main issues… 1. Ripple holding a large portion of tokens and selling into the rallies. 2. Usage of the network does not necessarily require XRP tokens. Banks can use Ripplenet w/o ever touching the token,” he explained.
Yes. XRP tokenomics is a bit funny that way. The two main issues…
1. Ripple holding a large portion of tokens and selling into the rallies.
2. Usage of the network does not necessarily require XRP tokens. Banks can use Ripplenet w/o ever touching the token. https://t.co/oDM2dO1vhV
— Mati Greenspan [not trading advice] (@MatiGreenspan) December 29, 2019
These factors are likely to hold significant influence of the cryptocurrency’s price action in 2020 and may mean that it will see further downside in the coming months.
Featured image from Shutterstock.