Ripple (XRP), the fourth largest cryptocurrency by market cap, is currently in the midst of a massive collapse and has dropped to $ 0.41, a decline of over 20 percent.
Meanwhile, Coincheck, one of the largest cryptocurrency exchanges in Japan, temporarily stopped processing XRP sales orders, according to a statement on Twitter. The function was then re-opened by the trading platform. The suspension came after the token dropped a significant portion of its earnings. XRP had surged to a monthly high of $ 0.75 on Bitfinex after several pump groups made a coordinated effort to artificially raise the token price. An hour later it dropped by 30%. Coincheck is primarily known in the industry for losing about $ 560 million worth of NEM (XEM) tokens in early 2018.
Many analysts did not find the XRP rise sustainable. According to a report in Forbes, economist Alex Krüger used the following statements:
“I DO NOT EXPECT THE RISE OF XRP TO BE AS GREAT AS DOGECOIN’S RISE THIS WEEK, BUT IT WILL RESULT IN A DOWNWARD EXPLOSION. THE PRICE MOVEMENT OF XRP IS MORE DIFFICULT BECAUSE IT HAS A MUCH MORE MARKET VALUE THAN DOGECOIN; BUT I PREDICT THAT USERS CAN INCREASE THE PRICE UP TO 0.75 – 1.00 USD. ”
At the time of writing, the exact reason for the price drop is unknown. However, according to a report in CoinDesk, it is quite possible for a whale to benefit from the price increase and dump its assets. Pump and dump strategies are very popular in the crypto markets.