TL;DR
- Price Correlation Evidence: Recent data shows a high correlation coefficient (0.84) between Bitcoin and Ripple prices, suggesting a closer relationship than previously thought, especially compared to the negative correlation between Bitcoin and stock prices.
- Trading Volumes Indicate Overlap: High daily trading volumes for the XRP-BTC pair on major exchanges like Bitstamp and Binance demonstrate significant overlapping interest among investors in both cryptocurrencies.
Way back in February 2019, “Mastering Bitcoin” author Andreas Antonopoulos claimed:
“People interested in XRP are not interested in Bitcoin.”
Background: BTC vs. XRP
The two ultra-high market cap, blue chip cryptocurrencies have certainly competed for capital inflows and development. Back in those “early days” of the burgeoning blockchain industry, so-called “Bitcoin Maxis” said Ripple wasn’t a “real” blockchain. The XRP army called Bitcoin an outdated blockchain.
Maxis claimed Bitcoin’s proof-of-work consensus mechanism to secure an entirely P2P cash network makes BTC more secure than XRP. Meanwhile, the most zealous Ripple supporters criticized Bitcoin for being too energy-intensive and slower to make payments.
But is it really true anymore that Bitcoin and Ripple people really have nothing to do with each other? Here’s what some of the data has to say.
Bitcoin Ripple Price Correlation: 0.84
The three-month Bitcoin Ripple price correlation coefficient is running at a hot 0.84, according to data from Macroaxis, a fintech analytics firm:
“The correlation between historical prices or returns on Bitcoin and XRP is a relative statistical measure of the degree to which these equity instruments tend to move together[…] Values of the correlation coefficient range from -1 to +1[…]”
Compare that to the Bitcoin stocks correlation, which fell into negative territory after the S&P 500 Index dipped while Bitcoin and XRP prices rallied in October.
Meanwhile, The XRP-BTC trading pair saw a daily volume Saturday of over 590,000 XRP on Bitstamp alone, according to TradingView data. On Binance, the XRP-BTC pair saw an even higher daily trading volume of 41.2 million XRP.
In addition to the high Bitcoin-Ripple price correlation, that’s strong evidence that there is an overlap of interest in XRP and BTC among a sizable number of cryptocurrency traders today.
The post Very Curious Finding About the Ripple (XRP) Price and Bitcoin appeared first on CryptoPotato.
