Recently, on the social network X (formerly Twitter), the user again enlisted the debate in the XRP community. He put forward the theory that Ripple could purposefully not give the price of token to grow. In confirmation of the idea, he brought five arguments.
We understand all the arguments of the analyst and conclude whether the price of the Ripple (XRP) token is under artificial pressure.
Ripple case against SEC
In December 2020, the SEC filed a lawsuit against Ripple. The commission claimed that through the sale of tokens XRP Ripple actually illegally distributed securities. A long struggle, which is finally nearing completion, caused significant damage to the price of XRP.
With the victory of Ripple in court, there were assumptions that other factors are also behind the unsatisfactory results of the XRP – not only legal proceedings.
What else interferes with the increase in the price of XRP
In the thread, the user discussed five key factors. The first of them is the huge XRP reserves on Ripple accounts. He said that the company currently holds more than 43 billion tokens in the escrow and monthly produces their part – this is a mechanism launched in 2017 to regulate the proposal.
Some believe that these sales are aimed at holding back the growth growth of XRP, holding it at a low level. However, the analyst noted: the Ripple Technical Director said that the company’s transactions within the ON-Demand Liquidity (ODL) do not affect market prices.
The user also drew attention to several small wallets with large volumes of XRP. Significant transactions from these wallets cause a drop in prices, which gives rise to fears about possible manipulations. Although there is a connection between these movements and a decrease in prices, there is no final evidence of deliberate control or intervention.
In addition, the analyst referred to a scientific study that revealed a negative correlation between the structure of transactions and the price with a coefficient of -0.73. This does not confirm the fact of an artificial underestimation of the price, but emphasizes the possible influence of complex network dynamics on the XRP course.
In conclusion, the user noted that in 2017, when the price of XRP has risen sharply, activity on the network increased significantly. However, some community clusters were reduced before key drops in prices, and several components dominated the network. It also caused fears about the possible distortion of the market.
Some analysts believe that the low price of the XRP can be part of the long -term Ripple strategy. The company may use it as a way to avoid excess attention, while developing its infrastructure.
The lawyer denied the idea of suppressing the price of XRP
Lawyer Bill Morgan denied these rumors. He clarified that Ripple does not control the 43% of the total XRP proposal, as some believe.
This means that the effect of Ripple is less significant than expected. Morgan also noted that the monthly sales of Ripple from the escrow make up less than 1% of the monthly volume of Token trading. Such a volume is too small to exert significant pressure on the price. He also emphasized that the influence of Ripple issues from escrow decreases over time.
In addition, Morgan referred to the SEC trial against Ripple. He noted that before filing a lawsuit, an 18-month investigation of the regulator did not find evidence of manipulation of Ripple prices.
So far it remains unclear whether the explanation of Morgan is scattering all the fears. Meanwhile, the debate about the price of XRP continues.
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Source: Cryptocurrency
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