The prices of XRP and Stellar (XLM) exhibit an uncanny tendency to mirror each other’s movements. This perplexing correlation has ignited spirited debate within the crypto community, prompting Ripple CTO, David Schwartz to offer his insights.
Instead of simply saying the crypto market was moving together, Schwartz warned against jumping to conclusions. He reminded everyone that the crypto market is naturally prone to big swings and that everything is interconnected.
Read Also: Ripple Executive: XRP and XLM Are Poised to Become the Pepsi and Coca-Cola of Central Bank Utility
This means that general market sentiment and the constant search for fair prices often cause all the different assets to move in the same direction at the same time. He didn’t believe the popular theory that Bitcoin’s influence on liquidity was the only reason behind this, arguing that it’s a more complex picture.
That's puzzling. I can't think of any reason why that would be the case. Maybe it's a self-fulfilling prophecy? XRP and XLM have tracked in the past, so people expect them to track in the future. So if one goes up, you buy the other expecting it to go up too, so it does.
— David "JoelKatz" Schwartz (@JoelKatz) December 18, 2023
The discussion became more interesting when the community started throwing out different ideas about why the crypto prices were moving together.
Some thought it might be automated machines trading in the market, while others suspected one big player pulling the strings. Schwartz, always calm and steady, reminded everyone that this whole thing is complicated and that people shouldn’t jump to conclusions too quickly.
To make things even trickier, Schwartz threw in a fascinating idea called a “self-fulfilling prophecy.” He said that maybe in the past, XRP and XLM always moved together, and now everyone expects that to happen again, which makes it happen even more. So, what started as a random connection might be driving the market now.
We are on twitter, follow us to connect with us :- @TimesTabloid1
— TimesTabloid (@TimesTabloid1) July 15, 2023
Read Also: Citing Historical Golden Cross, Analyst Projects $33 XRP and $6.5 XLM
Market Realities: Two Tokens, Two Stories
It’s important to remember that while XRP and XLM share the crypto stage, their backstories differ in many ways.
XRP, the heavyweight, boasts a market cap of $32.3 billion, compared to XLM’s smaller but respectable $3.3 billion. Even with its lighter size, XLM holds its own, suggesting that despite the price link, their journeys are separate.
XRP and XLM prices are oddly linked, and even though David Schwartz explains things well, we still don’t fully understand why. It’s not just a simple story. To figure it out, we need to watch closely, analyze carefully, and be wary of easy answers.
Follow us on Twitter, Facebook, Telegram, and Google News.
