Summary:

  • Ripple (XRPUSD on xStation5) breaks well above $3 for the first time ever being the second largest cryptocurrency
  • China’s digital currency exchanges hold off on launching their businesses in South Korea due to pending regulations
  • ECB’s Nowotny calls for taxation of Bitcoin transactions

Just a day earlier we wrote about a possibility of a continued rally in Ripple and after 24 hours later one can say that it did so. In the wake of a mind-bending increase registered during the past hours Ripple has already become the second largest cryptocurrency in terms of capitalization decisively surpassing $100 billion. Notice that it’s just obtained market capitalization accounting for more than 55% of Bitcoin’s one.

link do file download linkRipple retains the second place in terms of market capitalization giving way just to Bitcoin. Source: coinmarketcap.com

While on the one hand Ripple’s supporters suggest that the digital currency could strengthen further mainly due to its useful functionality, there are also some sceptics pointing that it’s unlikely because it’s centralized and cannot provide enough liquidity compared to Bitcoin. Finally the most devoted Ripple supporters argue that the virtual currency offers a faster and cheaper ledger system and comes with less risk for banks than Bitcoin. Let’s also remind that Ripple could have added to its gains following rumours that Coinbase will soon add Ripple trading functionality which in turn would make the virtual currency more accessible to a wider audience.

link do file download linkLooking at a daily chart of Ripple one may assume that the digital currency could be close to a tipping point as the price approaches an upper boundary of an ascending channel. Once this level is respected then a possible pullback might be on the cards. If so a retreat could reach as much as $2.6 where a 50% retracement of the potential rising wave is placed. On the other hand breaking a $3.3 handle durably could pave the way for subsequent highs. Source: xStation5

Apart from Ripple it’s worth mentioning a South Korean thread we wrote about yesterday. Due to pending regulations in South Korea aimed at banning anonymous cryptocurrency trading (scheduled to be implemented as soon as later this month) two major China’s crypto exchanges have chosen to hold off on launching their businesses in South Korea. Let us recall that the above-mentioned exchanges have been planning to enter the South Korea’s market for many weeks following a crackdown seen in China in September last year. That said until anonymous trading on cryptocurrencies in South Korea is not illicit two Chinese exchanges could still count on successful launches of their businesses, albeit all could change when the South Korean watchdog puts new regulations into effect.

link do file download linkBitcoin could experience a pullback in the nearest future as the price drew two bearish engulfing. Thus one could forecast that a possible downward move could go towards $13,600 where is a crucial support point (a broken trend line along with a local support area). Source: xStation5

There is nothing new that cryptocurrencies have become an important topic across financial markets so one should not be taken by surprise that central bankers weigh in from time to time. According to Ewald Nowotny, a member in the ECB’s governing council, Bitcoin ought to be regulated whereas all transactions via the digital currency should be taxed. His remarks came several days after another ECB’s member Benoit Coeure said that Bitcoin is a bubble and it could constitute a perfect mean to evade taxation and launder money.