The Ripple price rallied by 20 percent on Friday following the announcement that Santander had tapped Ripple technology for its new blockchain-based payment app.
The cryptocurrency markets made a unified advance for the second consecutive day on Friday, with most coins posting single-day gains in excess of 10 percent.
Among large-cap coins, none achieved a better return than Ripple’s XRP token, which soared by 20 percent to $0.64 after trading as low as $0.51 on Thursday. Ripple now has a $25.1 billion market cap, which is the largest it has been since mid-March.
The rally correlated with heavy trading volume in Asia. Four of XRP’s 10 highest-volume trading pairs were against the South Korean won, accounting for more than 47 percent of all XRP’s $1.4 billion in 24-hour trading volume.
It’s difficult to ascertain the precise reason for Ripple’s market-leading performance on Friday, but it’s possible that it stems from the announcement that Spanish banking giant Banco Santander has launched One Pay FX, an international payments app that utilizes Ripple’s enterprise blockchain technology.
The app — which is already live — is based on an implementation of Ripple’x xCurrent product, which uses blockchain technology but does not rely on XRP, Ripple’s public blockchain token. Consequently, the announcement would not necessarily seem to have a direct impact on the value of XRP, but similar news has historically led to price bumps anyway.
There are several possible theories for this phenomenon. The simplest explanation is that naive investors confuse Ripple — the company — and XRP and thus mistakenly believe that all Ripple news is bullish for XRP.
Alternatively, investors may be making a gamble that adoption of Ripple’s enterprise blockchain products in the short-term will help the San Francisco-based company market its XRP-based products to financial institutions over the long-term.
Featured image from Shutterstock.
Last modified: May 20, 2020 8:52 PM UTC