Ripple (XRP) is up 40 percent
The coordinated pumps of the Reddit group Wallstreetbets are endless and now the young traders seem to be targeting Ripple (XRP). But that's not the only reason for Ripple's price increase.
The price of XRP has risen sharply since Saturday and the pump is similar to that of GameStop and Dogecoin (DOGE).
The cryptocurrency rose nearly 40 percent in the last 24 hours and is currently trading at a rate of $ 0.6522.
Ripple is thus fighting its way back to third place among the largest crypto currencies by market capitalization. After the company behind XRP was recently targeted by the US Securities and Exchange Commission, this dramatic rise in price surprised many investors in the crypto community.
Ripple responds to SEC lawsuit
Ripple Labs, the company behind the cryptocurrency XRP, got into a lawsuit with the US stock exchange regulator a few weeks ago. The SEC is suing Ripple for illegally selling XRP.
Ripple responded last Friday and challenged the SEC's allegations in a comprehensive statement.
In the statement from Ripple, the company denies that XRP is a security. Additionally, Ripple Labs argues that the SEC failed to properly recognize the usefulness of XRP. XRP is not a share, as there is no investment contract with Ripple, nor does it promise profit-sharing or voting rights. Instead, the charges are completely out of context and are based on neither fact nor law. After the statement was published, the course of the third largest crypto currency recorded significant gains.
Is WallStreetBets behind the XRP pump?
Classic pump-and-dump tactics are nothing new in the crypto space. XRP in particular has a loyal following, which has often caused extreme price rises in the past.
It appears that today's price pump was triggered by members of a Telegram group called Buy & Hold XRP (t.me/pumpxrp), which was launched on Saturday. The group's membership hit Telegram's 200,000 mark within the first 24 hours, forcing a migration to a new official channel with a similar title but a different link (t.me/pumpxrpofficial). One of the goals of the group is to trigger a short squeeze to drive the XRP price up.
This strategy currently seems to be working, but it remains to be seen whether trading on popular trading apps and exchanges will be stopped in the next few hours, similar to what happened with GameStop, AMC and Dogecoin.
The group r / satoshistreetbets is considered a crypto offshoot of the well-known Reddit group r / wallstreetbets. WallStreetBets is not directly responsible for the XRP pump, but it can be assumed that many members of one group also belong to the other group.
The speculative madness of small investors has now also arrived in the crypto market and every hour more and more market participants come together in forums and bet on cryptocurrencies on a large scale.