After Reddit frenzy: XRP price collapses by 50 per cent after highs
XRP has been the latest target of the Reddit crowd. After hitting all-time highs, it plunged 50 percent on Monday.
XRP currently ranks fourth among cryptocurrencies by market capitalisation, falling nearly 50 percent in less than two hours on February 1. The trading frenzy has left new investors reeling in the process.
Data from Cointelegraph Markets and TradingView showed that extreme volatility began in the XRP/USD pair on Monday. Hours earlier, the now-infamous Reddit group r/Wallstreetbets had decided to buy of Bitcoin Trader platform the token en masse.
After the coin reached a high of US$0.75, losses quickly mounted and the downward trend accelerated. Subsequently, the XRP recovered from a low of US$0.39, 48 per cent below the peak.
At the time of going to press, the XRP/USD pair was hovering around US$0.45. However, there are still large fluctuations. The Social Daily Sentiment Score barometer has also reached levels not seen since January 2018, according to data from The Tie.
XRP sentiment barometer Source: The Tie
In response, critics of the controversial altcoin warned of the dangers of investing in it compared to Bitcoin (BTC) for short-term trading.
„Even if the $XRP army gets mad when you warn them about the trust elephant in the room, I just feel sorry for those who bought at $0.75. X R (I)P,“ Cointelegraph Markets contributor Keith Wareing summed up on Twitter.
DOGE holds out
Previously, XRP was in a downtrend following litigation against Ripple. Ripple is the blockchain payment network behind the coin, which is also its largest investor. The recovery pleased some of the fans who had watched the coin fall to a low of below US$0.16 just a few weeks ago.
XRP was not the only target of Reddit traders on the day, as Dogecoin (DOGE) and silver also saw big gains.
At the time of writing, the DOGE/USD pair was able to maintain its growth and stood at around US$0.04. Elon Musk mentioned the coin in an interview on Sunday, singling it out among other altcoins. This has made the mood among fans of the meme altcoin even more optimistic.
Bitcoin, on the other hand, had little to show for it. At the time of going to press, it was at around 35,100 US dollars.