Despite the 50% decline that has been seen over the past six months, Bitcoin (BTC) remains up 70% since the start of 2019, beating a majority of other mainstream asset classes such as American equities. While the rest of the cryptocurrency market is known to follow the market leader, some altcoins remain down, negative, on the year.
The most notable of these underperforming altcoins is XRP, the third-largest cryptocurrency. The popular though controversial digital asset, according to Coin360 data shared by Bitcoin hedge fund manager Tuur Demeester, is down some 48% since January 1st, 2019, marking a strong underperformance against Bitcoin. The BTC/USD pair, understandably so, has also seen a strong drop.
Cryptocurrency 2019 YTD performance pic.twitter.com/lVVrDXEVFB
— Tuur Demeester (@TuurDemeester) December 17, 2019
It isn’t clear why exactly XRP has done so poorly in a year when assets across the world — from questionable low-cap stocks and commodities like gold to real estate and investment-grade bonds — have all performed strongly, though there are a few theories.
The most notable of these theories is that XRP has had a high effective inflation rate through the past year due to sales of the cryptocurrency by Ripple Labs to fund operations. A similar trend has been seen with Stellar Lumens, which has also strongly underperformed in the past year due to a copious amount of airdrops of the cryptocurrency.
Ripple has denied the analyses that it is pushing down the price of XRP through its sales, though many analysts still think that the cryptocurrency has been subject to the downtrend due to the aforementioned sales of XRP.
Do XRP Holders Have Anything to Look Forward to?
Well, in terms of fundamentals, Coinmetrics has found that the XRP Ledger’s metrics have begun to surge higher:
Firstly, there has been a significant increase in the transaction count over the last fortnight,” they said while pointing to the below…