Although in the past, I've been a supporter of XRP, and especially XLM, I ultimately realized the cryptocurrency itself is not particularly user-friendly, considering a tag and an address are both required. Minimum balances are also required. I also began to see through Brad Garlinghouse's smugness, and the obvious market manipulation.
Nevertheless, as far as crypto goes, these two are probably the most likely to be of any use from a settlement standpoint. Perhaps this is why the SEC is trying to be "light" on them. I may even repurchase some XLM just to have some. I've long been a fan of cryptocurrencies that have real utility as money. Nano (XNO) is also a good one, but it'll probably fade into obscurity with occasional pumps and dumps.
A major issue with XRP is that indeed it really could be seen as a security. Still, much of the supply remains off the market, which means there is a lot of sell pressure. Big holders capitalize on the quick pumps to eke out profit and to reduce risk. Even though the SEC decision had nothing to do with XLM, it pumped at the same time simply because the founder of Stellar has former business ties with XRP! If this does not scream "investment contract" then I don't know what does.
If you look at the historical chart for XRP, you can see most pumps are quickly followed by dumps. Even when XRP hype was at its peak near the end of 2017, price could not sustain. In fact, it was XRP's enormous pump that signaled the end of the crypto bull run.
Here comes the challenge:
The simple observation, after years of observing this market: Cryptocurrencies tend to reverse to the downside after a large amount of hype and good news. This is because there is very little legitimate utility, as the value derives from speculation. See the recent news as an example. If this were a company with a new useful product/service, value would continue upwards because utility follows hype. More people would suddenly use it, realizing how helpful it is. That's not the case in crypto. What happened here? People bought more XRP and XLM, believing the decision to fuel bullish speculation. This is irrespective of the fact that private institutional sales were still seen as unregistered security offerings.
Yes, the recent SEC decision has given a small positive nudge to crypto tokens and their access to the retail market, essentially allowing there to be more bullish speculation. Coinbase's decision to re-list XRP is proof. But bullish speculation has ALWAYS led to market crashes within this market. Every large move up for altcoins like XRP has preceded a large move DOWN for Bitcoin. This is because alts like XRP are seen as "the next possible Bitcoin" to investors, wanting to get rich quick. When the pump fizzles out, people realize that even "new, better tech" does not live up to its promises. And then the whole market collapses as it is all revealed to be a sham. As such, XRP and XLM often signal the end of a bullish wave.
So, we MUST see some utility come out of this. Otherwise, the market is likely to see a markdown in value, as investors realize they were duped into buying fluff. Let's see if in hindsight this signaled a reversal to the downside. New lows are not out of the question.
It may seem like institutions are cozying up to crypto, but I actually think it's a bad sign. Markets are slowing down, and they're trying to find buyers for things. Material things (especially housing) are now out of reach for so many people. The wealthy elite know this, so they are trying desperately to get people to buy things like crypto, which are only marginally safer than lottery tickets.
This is not meant as financial advice - this is meant for speculation and entertainment only. Thank you for reading!
-Victor Cobra
Nevertheless, as far as crypto goes, these two are probably the most likely to be of any use from a settlement standpoint. Perhaps this is why the SEC is trying to be "light" on them. I may even repurchase some XLM just to have some. I've long been a fan of cryptocurrencies that have real utility as money. Nano (XNO) is also a good one, but it'll probably fade into obscurity with occasional pumps and dumps.
A major issue with XRP is that indeed it really could be seen as a security. Still, much of the supply remains off the market, which means there is a lot of sell pressure. Big holders capitalize on the quick pumps to eke out profit and to reduce risk. Even though the SEC decision had nothing to do with XLM, it pumped at the same time simply because the founder of Stellar has former business ties with XRP! If this does not scream "investment contract" then I don't know what does.
If you look at the historical chart for XRP, you can see most pumps are quickly followed by dumps. Even when XRP hype was at its peak near the end of 2017, price could not sustain. In fact, it was XRP's enormous pump that signaled the end of the crypto bull run.
Here comes the challenge:
The simple observation, after years of observing this market: Cryptocurrencies tend to reverse to the downside after a large amount of hype and good news. This is because there is very little legitimate utility, as the value derives from speculation. See the recent news as an example. If this were a company with a new useful product/service, value would continue upwards because utility follows hype. More people would suddenly use it, realizing how helpful it is. That's not the case in crypto. What happened here? People bought more XRP and XLM, believing the decision to fuel bullish speculation. This is irrespective of the fact that private institutional sales were still seen as unregistered security offerings.
Yes, the recent SEC decision has given a small positive nudge to crypto tokens and their access to the retail market, essentially allowing there to be more bullish speculation. Coinbase's decision to re-list XRP is proof. But bullish speculation has ALWAYS led to market crashes within this market. Every large move up for altcoins like XRP has preceded a large move DOWN for Bitcoin. This is because alts like XRP are seen as "the next possible Bitcoin" to investors, wanting to get rich quick. When the pump fizzles out, people realize that even "new, better tech" does not live up to its promises. And then the whole market collapses as it is all revealed to be a sham. As such, XRP and XLM often signal the end of a bullish wave.
So, we MUST see some utility come out of this. Otherwise, the market is likely to see a markdown in value, as investors realize they were duped into buying fluff. Let's see if in hindsight this signaled a reversal to the downside. New lows are not out of the question.
It may seem like institutions are cozying up to crypto, but I actually think it's a bad sign. Markets are slowing down, and they're trying to find buyers for things. Material things (especially housing) are now out of reach for so many people. The wealthy elite know this, so they are trying desperately to get people to buy things like crypto, which are only marginally safer than lottery tickets.
This is not meant as financial advice - this is meant for speculation and entertainment only. Thank you for reading!
-Victor Cobra
Comment:
A little retest of the highs today for XRP and XLM. No movement from Bitcoin, aside from slightly down. This often signals that a market top is near. Let’s see if this time is any different. DXY also bounced strongly from the lows.
Comment:
Bitcoin is getting very close to the uptrend from its recent run. A drop below should send price pretty quickly at least back to $26.8-27k to search for support.
Comment:
As expected, full retrace.
Comment:
It's honestly hilarious that insiders dumped XRP at the exact same level BOTH times on Coinbase. Nearly 3 years apart. You can't make this shit up.