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Ripple's native token, XRP, has recently faced a significant decline, dropping nearly 7% within the past day. This downturn comes amidst ongoing political instability in South Korea and renewed scrutiny over Ripple Labs’ past activities in the region. Allegations of a controversial 2014 project, “Ripple Market Korea,” have resurfaced, raising questions about the token's history and investor sentiment. As South Korea remains a crucial market for XRP, the combination of political upheaval and historical controversies has added pressure to XRP price, leading to heightened market volatility.
In recent days, reports have surfaced about Ripple Labs’ operations in South Korea dating back to 2014. Allegations suggest that Ripple Market Korea, a platform introduced by Ripple Labs, operated as a Ponzi scheme. This platform reportedly attracted a large number of investors, referred to locally as “Ajummas,” promising significant returns through XRP holdings.
Ripple Market Korea issued its own token, RMK, and marketed XRP as a revolutionary financial instrument capable of seamless fiat exchange. Backed by endorsements like Google Ventures and touted for its compliance with U.S. regulations, the project sold out its initial round of XRP within just two hours in 2014. However, recent revelations about its potentially fraudulent structure have reignited skepticism around XRP, especially in South Korea.
Several Korean media outlets have highlighted the enduring strength of XRP’s community in the country, even amidst these allegations. Despite the controversy, XRP remains popular among South Korean investors, who have historically been among the highest contributors to XRP’s trading volume globally.
The broader political environment in South Korea has also added pressure to XRP price. President Yoon Suk-Yeol’s recent declaration of martial law, albeit short-lived, created widespread market uncertainty. During the emergency, XRP and other cryptocurrencies experienced a sudden dip in trading activity on South Korean exchanges, including Upbit, where XRP has traditionally been a high-volume asset.
The ripple effect of this crisis has extended to global markets, with Bitcoin also witnessing a brief sell-off during the period. As the political situation stabilizes, attention has shifted back to Ripple’s historical activities and their implications for investor sentiment.
Price Surge Preceding the Drop: The daily chart reveals that XRP had been in a strong uptrend, surging by an impressive 477.72% over the last 29 days, as seen in the uploaded chart. This rally was supported by high trading volumes, indicating robust demand for XRP during its upward momentum.
Current Price Levels: XRP is trading around $2.5564, retreating from its recent high of approximately $2.9287. The price correction coincides with the broader market uncertainty triggered by political developments in South Korea.
Support: The nearest support level lies at $2.50, which has historically acted as a consolidation zone during the rally.
Resistance: Key resistance remains near $2.90, which aligns with the recent peak. A breakout above this level would signify renewed bullish momentum.
Volume Trends: Trading volumes have spiked during the price drop, suggesting active participation from both buyers and sellers. This highlights heightened market volatility and the need for traders to remain cautious.
The moving averages (20, 50, 100, 200) indicate a consolidation phase, with the price hovering near the 200-period MA at $2.5569. This level is critical for XRP to maintain its short-term bullish structure.
The MA ribbon shows some bearish divergence, as shorter-term MAs are starting to slope downward, reflecting the recent price correction.
XRP has been forming a sideways consolidation pattern after the sharp correction. This suggests that the market is awaiting new catalysts to determine its next directional move.
A potential descending triangle is emerging, which may lead to a breakout or breakdown depending on market sentiment and volume inflows.
Volume Analysis: The 15-minute chart highlights intermittent spikes in trading volume, particularly during attempts to break above the $2.60 resistance level. This indicates that sellers are actively defending higher levels.
Despite the short-term dip, XRP’s long-term outlook remains positive due to its significant community support and historical relevance in the cryptocurrency ecosystem. The current price correction is likely influenced by external factors, including political instability and historical allegations against Ripple Labs. However, if XRP can hold above its key support levels, a recovery may be on the horizon.
Bullish Case: If XRP regains momentum and breaks above $2.90, it could aim for new highs above $3.00. This would require sustained buying pressure and a favorable macroeconomic environment.
Bearish Case: A breakdown below $2.50 could lead to further declines, with the next support level near $2.30. This would reflect heightened bearish sentiment and reduced investor confidence.
XRP’s recent decline highlights the interplay between market dynamics and external events, such as political instability and historical controversies. While the ongoing revelations about Ripple’s past activities in South Korea add a layer of uncertainty, XRP’s strong community backing and impressive rally over the past month underscore its resilience.
Traders and investors should monitor key support and resistance levels closely, as well as developments in South Korea, which continues to be a pivotal market for XRP. With the broader cryptocurrency market stabilizing, XRP’s next move will likely depend on its ability to overcome near-term challenges and sustain its long-term growth trajectory.
