According to a recent report from CryptoQuant, Ripple’s landmark victory in its lawsuit against the U.S. Securities and Exchange Commission (SEC) has potentially initiated a bull market for neighboring altcoins. The crypto market intelligence firm has provided data indicating a surge in altcoin market activity over the past week, compared to the relatively stagnant Bitcoin (BTC) and Ethereum (ETH) markets.
When analyzing price performance based on market capitalization, CryptoQuant’s statistics reveal that MidCaps, which include XRP, have outperformed other groups of cryptocurrencies. On June 13th, MidCaps experienced a staggering 29% increase. This growth includes other cryptocurrencies that were previously classified as securities by the SEC in its lawsuit against Coinbase last month. The chart below illustrates the market caps of these coins, such as Cardano (ADA), Solana (SOL), Polygon (MATIC), and others, in comparison to BTC and ETH.
Legal Ruling on XRP’s Status
On July 13th, the Ripple V. SEC lawsuit concluded with a summary judgment that declared XRP itself is not a security, and the sale of the token on secondary markets does not qualify as securities transactions. This ruling is significant as it marks the first time a cryptocurrency company has successfully defended against the SEC’s claims that all crypto assets, excluding Bitcoin, are securities.
Despite a brief rally to $31,700 following the landmark ruling, Bitcoin’s price has since retraced to around $30,000 and remains rangebound. As a result, the dominance of the top asset in the market has slightly declined, falling below 50% according to TradingView. Interestingly, Bitcoin’s open interest has not been adversely affected, while ETH’s open interest has significantly increased from $2.2 million to $2.7 million since the ruling. However, when examining funding rates, it appears that XRP has had minimal impact on market sentiment.
CryptoQuant notes, “We can observe mixed sentiments among derivatives traders as Bitcoin funding is relatively high while Ethereum’s funding rates just turned negative.”
Negative Sentiment among Traders
Furthermore, analysts have found that short-term sentiment among traders remains negative when assessing the Taker Buy Sell Ratio for Bitcoin and Ethereum. This ratio indicates the balance between buy and sell pressure for each asset. Currently, both cryptocurrencies have a ratio of less than 1, suggesting that taker buy volumes outweigh taker sell volumes, indicating bearish attitudes.
Implications for the Altcoin Market
Ripple’s legal victory against the SEC has not only provided clarity on the status of XRP but has also had a ripple effect on the altcoin market. The significant growth in altcoin market activity, particularly among MidCaps, indicates renewed investor interest and confidence in these alternative cryptocurrencies.
As the market dynamics continue to shift, it will be interesting to observe how altcoins perform in the coming weeks. With the SEC’s classification of XRP as a non-security, other altcoins previously considered in the same category may also experience increased demand. However, it remains crucial for investors to conduct thorough research and exercise caution when navigating the ever-changing crypto landscape.