TRUMP Sucks Ripple’s XRP Liquidity

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MARKETS TREND

XRP showed no signs of a bullish run despite news that US President Donald Trump signed an executive order creating a Presidential Working Group on digital assets.  XRP experienced a 5% pullback for the week, corresponding with growing market sentiments of a bullish exhaustion.

Ripple

Donald Trump, the president of the United States, has come under fire for introducing a meme-coin while claiming to be “naive” about the cryptocurrency.

The TRUMP token surfaced on his social media accounts on Sunday and swiftly rose to the top layer of the cryptocurrency market. The token has weakened the buying pressure of top altcoins like XRP, Doge, and Shiba Inu.

The value of a single coin rose to $75 within a day, but it has since dropped to $33. However, the meme’s introduction has drawn criticism for sucking liquidity out of the cryptocurrency market. XRP has lost more than  5% since Trmp’s token launch.

According to CoinMarketCap, TRUMP coin is currently the 25th most valuable cryptocurrency, worth approximately $6.08 billion.

In addition,  XRP’s open interest (OI) growth has slowed down this week, falling from its highest point ever of 234 billion XRP to 214 billion XRP. The total number of contracts still pending in a derivatives market is known as open interest. When the OI drops, it indicates that traders are getting rid of their positions.

Consequently, The Chicago Mercantile Exchange (CME) clarified that it has not decided to launch futures contracts for XRP, caused a wave of negative sentiment among the XRP community, which has been waiting for the launch to confirm potential Securities and Exchange Commission (SEC) approval of XRP ETFs.

Trump pledged to strengthen cryptocurrency’s legitimacy during his second term, but his effective stake in the coin has sparked questions about conflicts of interest. However, the main concern is what would happen to investors if Trump were to abruptly cash out on the meme coin due to the Trump Organization’s dominant ownership.

Trump supporters’ faith in the president can be measured quantitatively by the performance of his meme coins. According to the Trump memecoin website, purchasing $TRUMP shares is not an investment opportunity but a way to express support for the president. A significant sell-off that causes the value of $TRUMP to plummet further could hurt public trust in Trump’s administration.

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ABOUT THE AUTHOR See More
Olumide Adesina
Olumide Adesina
Financial Market Writer
Olumide Adesina is a French-born Nigerian financial writer. He tracks, analyzes, and reports changes in financial markets with over 15 years of working experience in investment trading.
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