- Grayscale Investments, an asset management giant, announces the creation and launch of XRP Trust on Thursday.
- Grayscale’s single-asset investment fund is expected to attract institutional investors and capital to the altcoin.
- XRP gains 4% on the day, having surged more than 10% earlier in the session.
Ripple (XRP) rallied as much as 10%Â on Thursday following the announcement of a new vehicle for institutional investment. The altcoin corrected and has sustained 4% gains for now. Asset management giant Grayscale announced the creation of a single-asset investment fund for XRP.Â
XRP trades at $0.5602 at the time of writing.Â
Daily digest market movers: Grayscale announces XRP Trust
- Grayscale has $26 billion in assets under management as of January 10, 2024. The crypto asset management firm announced the launch of a single-asset investment fund for XRP.Â
- In the official press release, Grayscale’s Head of Product & Research, Rayhaneh Sharif-Askary, says that the asset management giant plans to give investors exposure to a protocol with an important real-world use case.Â
- Ripple facilitates cross-border payments within seconds through XRP, the native token of the XRP Ledger, and this has the potential to transform legacy financial infrastructure.Â
- Grayscale’s announcement was met with enthusiasm among XRP traders, and the altcoin peaked at $0.5884, a 10% rally from the September 11 close of $0.5348, early on Thursday.Â
- Since then XRP price corrected and the altcoin trades at $0.5602, up 4% on the day.Â
Technical analysis: XRP could extend gains by 7%
XRP has been in a multi-month downward trend since its July 13 top of $0.9380. XRP could extend gains by 6.9% and rally to the lower boundary of the Fair Value Gap (FVG) between $0.6217 and $0.6000. The Moving Average Convergence Divergence (MACD) indicator is a momentum indicator that supports the bullish thesis and the green histogram bars above the neutral line indicate positive underlying momentum in XRP price trend.Â
XRP/USDT daily chart
If Ripple closes a daily candlestick under September 11 low of $0.5231, it could invalidate the bullish thesis, and XRP could collect liquidity at $0.5000, another key support level that has held steady since July 2024.Â
Cryptocurrency metrics FAQs
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
