On December 20, XRP lost its position as the fifth-largest cryptocurrency by market capitalization. This happened due to a surge in the Solana native token SOL.
In this article, we will explore the reasons for XRP's decline, examine the impact of the SEC lawsuit, and analyze the market for XRP and its major competitors.
XRP's Market Cap Slips as Solana Gains Momentum
CoinMarketCap data reveals that SOL's market cap skyrocketed above $35 billion, experiencing a remarkable 12% surge in the last 12 hours a few days ago.
At the time of writing this, SOL's market cap stands at $40.39 billion, marking its highest value since April 2022.
Over the past month, XRP's market dominance has significantly declined due to its consolidation period, while Bitcoin's price witnessed a surge of 19%.
Similarly, Ether saw a notable increase of 15% during the same period. Unfortunately for Ripple, the impending SEC lawsuit has created uncertainty over the cryptocurrency, leaving traders and investors awaiting its trial in four months.
XRP's Potential Path to Recovery
Despite XRP's decline of 10.63% on the 6-month chart, it fares slightly better than Ethereum's decline of 12.91%.
Ripple Labs has recently secured several victories against the SEC, which have positively influenced XRP's price in the market.
However, the ongoing legal battle with the Securities and Exchange Commission, which commenced in December 2020, has been a significant obstacle to XRP's growth over the past three years.
The outcomes of the lawsuit over the next four months will undoubtedly impact Ripple's price movement and overall market share.
As of now, the market capitalization of XRP stands at $33.47 billion. However, it is still behind the leading assets in the market. In the past month, most of the major cryptocurrencies have seen a significant price increase. However, XRP has experienced an 8% drop since September 12.
In contrast, XRP has only seen a modest increase of 1%. At the time of writing, XRP is trading at $0.61.
Analyzing the daily chart, it becomes evident that XRP entered a new bear cycle on December 12, with its MACD line (blue) crossing below its trend line (yellow). This bearish shift is considered by many traders as a signal to sell, often leading to a decline in asset value.
In summary, XRP's market dominance has dwindled by 3.63% over the past week, 18.83% over the past month, and 10.63% over the past six months.
Over a one-year timeframe, Ripple's market share has diminished by 11%, and over five years, it has experienced a significant decline of 82%.
In comparison, Bitcoin's market share has only decreased by 10.59% over five years, demonstrating a more resilient performance.
Furthermore, Bitcoin's dominance has increased over the past year, six months, and one month.
With the recent downturn in XRP's price trend and the influence of bears in the market, it remains to be seen how Ripple's cryptocurrency will regain its market dominance amidst growing competition.