- Cryptocurrencies of all sizes got smoked this week, when a “bloodbath” of sell-offs wiped out roughly 43% of the world’s total cryptocurrency market cap.
- But the highly-volatile space appears to be making a comeback on Thursday, with Ripple’s XRP cryptocurrency leading the charge.
The digital coin had plunged well below the $US1 mark on Wednesday, bottoming out at $US0.8771, in the depths of a global cryptocurrency sell-off.
Less than two weeks ago, the cryptocurrency market reached an all-time high above $US830 billion, before fears that South Korea, China, and Russia were all mulling crackdowns on mining and exchanges lead to a global sell off.
XRP, which was invented by Ripple for global payments and bank transfers, lost 73% of its value in less than a month. Those steep losses could have amounted to as much as a $US12 billion hit for co-founder Chris Larsen, who owns 5.71 billion units of XRP.
To be sure, XRP is still more than 5,000% above its price a year ago. The high volatility of cryptocurrencies has attracted both Wall Street and retail investors looking to find more alpha than they could in the highly-regulated and much less volatile stock market.
“Most people who were buying bitcoin and other cryptocurrencies most recently, are not using them for transactions, but holding them in the expectation of profiting from the endless rising price,” Hussein Sayed, chief market strategist at FXTM, said in an email on Thursday morning.
“Whether the animal spirits have already released their grip, remains to be seen and this cannot be ascertained from a two-day slump.”