Understanding the Correlation Between XRP and XLM
Industry experts and investors have noticed a strong correlation between the price movements of XRP and XLM. Ripple’s CTO, David Schwartz, has commented on this correlation, stating that more liquidity is needed to drive a significant price correlation. CoinmarketCap data shows the parallel price movements of these two cryptocurrencies over the past year.
The Factors Behind the Correlated Price Movements
Schwartz identifies three key factors influencing the correlation between XRP and XLM prices. Firstly, he suggests that the entire digital asset market is interconnected, so industry news affects all tokens. Secondly, Bitcoin’s dominance in the cryptocurrency market plays a role as its price movements impact other cryptocurrencies. Lastly, developments within the crypto industry can lead to parallel reactions from users of both XRP and XLM.
Perspectives on XRP’s Price Action
Lawyer Bill Morgan emphasizes the importance of a long-term perspective when analyzing XRP’s price action. He believes that convictions about the token should go beyond short-term fluctuations. Matt from the Moon Lambo YouTube channel notes that while XRP has experienced a decline over the past month, it still performs moderately compared to other top 50 coins by market cap.
Hot Take: Examining XRP’s Market Dynamics
Despite a market-wide rally, XRP has fallen by over 2% in the past month. This decline suggests that there may be unique market dynamics affecting XRP’s performance. Further analysis is necessary to understand why its decline was more pronounced compared to some of its peers.
By
By
By
By