The Ripple price roared past $1.05 on Monday amid surging volume in South Korean markets.
The move was somewhat unexpected, as the Ripple price had spent the previous week on a gradual downslope, declining from $0.94 on Feb. 25 to $0.89 on March 4.
However, on Sunday evening, the Ripple price began to explode, and the XRP token posted an 18 percent increase, a rally that bested those of all other top 100-cryptocurrencies.
At present, the Ripple price is valued at $1.06 on Bitfinex, which translates into a $41.8 billion market cap.
The rally correlated with heavy XRP trading in South Korean markets. Bithumb’s XRP/KRW pair alone accounts for nearly 31 percent of Ripple’s daily volume, while KRW markets at fellow South Korean exchanges Upbit and Coinone comprise another 13 percent.
Despite this heavy concentration of trading volume, the “kimchi premium” — a nickname for the discrepancy between prices at South Korean exchanges and other major trading platforms — appears to have disappeared, as XRP/KRW pairs are trading at virtually the same level as XRP/BTC and XRP/USD.
The impetus behind Ripple’s dramatic price movement is not immediately clear.
However, given that volume is so heavily concentrated in South Korea, it may be linked to a recent report that Woori Bank — one of Korea’s “big five” financial institutions — had completed the second phase of an overseas remittance trial using Ripple’s enterprise blockchain.
While such enterprise blockchain trials do not involve the XRP token, many investors believe that banks, money transfer services, and other financial institutions will adopt XRP-integrated products in the future, once they have become comfortable with blockchain-based systems.
However, reports of the trial first emerged on March 2, so — if Woori’s blockchain trial was indeed the rally’s catalyst — it is unclear why there was a several-day delay between the reports and XRP’s surge.
Notably, Stellar’s Lumens token, which — perhaps incorrectly — has been described as a “poor man’s Ripple,” appears to have caught XRP’s tailwinds, as the XLM price is up 13 percent for the day.
Featured image from Shutterstock.
Last modified: May 20, 2020 9:02 PM UTC