In the face of escalating tensions surrounding Ripple’s lawsuit and macro headwinds in the US economy, the cryptocurrency market has suffered a sharp decline.
Over the past two days, the market has witnessed significant volatility, and XRP has not been immune. The token has suffered a sharp decline after hitting a high of $0.5687 last Tuesday, trading at $0.5217 at the time of writing.
Analysts have suggested that the drop in XRP’s price may be influenced by the strengthening US economy and growing uncertainty surrounding Ripple’s legal battle.
US Economic Strength Impacts Crypto Markets
In economic data released Tuesday, US Durable Goods Orders increased by 2.6% in March.
Furthermore, the report noted Core Durable Goods Orders rose by 0.2%, a significant improvement over February’s 0.1% increase.
The data suggests that the US economy is strengthening, impacting investor sentiment regarding the Fed’s potential interest rate cuts in September.
In addition to XRP, several other cryptocurrencies have been impacted, leading to the total cryptocurrency market cap shedding 2.97% and losing over $2.3 billion since yesterday’s sell-off.
Ripple vs. SEC Lawsuit Developments
Aside from the impact of the Fed’s monetary policy on investor sentiment, the crypto market has also been affected by new developments in the ongoing legal battle between Ripple and the SEC. Growing concerns over an unfavorable outcome have contributed to XRP’s decline.
Recent motions filed by Ripple could potentially prolong the legal battle. However, many observers believe that the SEC’s compelling arguments may lead to Ripple facing penalties for selling unregistered XRP to institutional investors.
