The worst thing about fear is that it starts a vicious cycle. Panic only begets more panic. And if you’re looking for proof of this phenomenon, look no further than today’s Ripple news.
XRP prices dropped 11.29% in yesterday’s trading, extending the sell-off that began on Monday.
Fear is likely behind the recent fall; fear of being the last one to exit a sinking ship.
But that fear is not grounded on anything factual. There was no material change to our Ripple price forecast this week, except for a few pieces of bullish news from SWELL.
For those unfamiliar with SWELL, it is Ripple’s first ever conference. It is being held this week in Toronto. On day one of SWELL, the former Chairman of the Federal Reserve, Ben Bernanke, spoke glowingly about blockchains like Ripple while disparaging public blockchains like Bitcoin.
This should have been a tailwind for Ripple. But investors did not take the bait.
Then, on the same day, the Bill and Melinda Gates Foundation adopted Ripple’s “Interledger” for use in their charitable efforts. That, too, failed to bolster Ripple prices.
The consensus on forums is that Ripple selling pressure is rising. Herd mentality has kicked in and investors are running for the exits.
After all, XRP prices had risen by double digits the week before. At that time, investors were driving the Ripple to USD exchange rate closer and closer to $0.30.
If nothing of consequence happened between then and now, why the sudden shift towards bearishness?
It simply doesn’t make sense. All the underlying factors—Singapore expansion, use-case development, 100 FIs on the network—confirm our $2.00 Ripple price prediction for 2018. But I suppose that’s another thing about fear: It doesn’t need to make sense in order to wreak devastation on asset prices.