Understanding the Ripple Fallout
Amidst the chaos in the crypto world, Ripple’s XRP suffered a major blow when the wallet of one of its co-founders was compromised, leading to the disappearance of over 200 million XRP. This shocking incident, uncovered by cybersecurity analyst ZachXBT, not only caused a surge in XRP token sales but also highlighted significant security vulnerabilities in the crypto industry.
Impact on the Market
After the breach, blockchain analytics firm Kaiko revealed a net sell-off of almost 100 million XRP, primarily on exchanges like Binance and OKX. Despite efforts by these platforms to freeze the hacker’s accounts, the damage was done, resulting in a noticeable decrease in XRP’s market cap.
The report examines XRP’s cumulative volume delta (CVD), a metric indicating the number of participants buying and selling. On Jan. 30, despite a positive CVD as users acquired more XRP, especially on Binance, the coin’s price still fell by 4.58% due to market turbulence. Struggling to stay above the critical support level of $0.55, XRP faced bearish pressure, possibly signaling a downward trajectory toward $0.37—an immediate consequence of the hack.
Hack’s Effects on XRP and Crypto Market
ZachXBT suggests these withdrawals include XRP assets converted during the Larsen hack. Later, some of these Kraken funds were routed to a Bitcoin mixer, showcasing the ripple effect of the hacking incident on XRP and the broader crypto market.
Hot Take: Analyzing the Ripple Fallout
The Ripple XRP hack and subsequent market reaction have exposed the vulnerability of the crypto industry, raising concerns about security and stability. It serves as a stark reminder for investors to exercise caution and for the industry to address security gaps to prevent similar incidents in the future.
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