Ripple (XRP) price has surged more than 3.5% in just more than an hour on the claims of Ripple’s CEO that the company’s initial public offering (IPO) may be organised in the coming 12 months.
Fundamental analysis: IPO is a “natural evolution for the company”
XRP has been moving lower on a continuous basis for the past 6 months. In general, there are two factors that can describe the downtrend: 1) the crypto market has traded lower as well, and 2) continuous negative headlines surrounding the Ripple company and XRP.
We already reported that Ripple sold $251.51 million in XRP in the second quarter of 2019, as revealed in the company’s Q2 results. Previously, Ripple sold nearly $170 million worth of XRP in Q1. This has prompted a part of the crypto community to accuse Ripple’s management of dumping the price and enriching themselves.
Going back to IPO, Brad Garlinghouse, Ripple’s CEO, stated that an initial public offering (IPO) should be regarded as “natural evolution for the company”.
“I think over the next 12 months you’re definitely going to see IPOs in the crypto, blockchain space. I’m not sure we want to be first but we certainly don’t want to be last either, so I expect we’ll be on the leading side of that, not the lagging side,” Garlinghouse said this morning in Davos.
This announcement from Garlinghouse comes a few days after his company announced that the sales fell 80% in Q4.
“We have been talking to the SEC for some period of time,” he said. “I feel like educating regulators is part of my job and I think that’s been a really constructive process.”
Last month, Ripple announced it had successfully completed a $200 million investment round, lifting its valuation to a huge $10 billion.
“We are in a strong financial position to execute against our vision. As others in the blockchain space have slowed their growth or even shut down, we have accelerated our momentum and industry leadership throughout 2019,” said Garlinghouse.
Technical analysis: $0.2550 seen as important short-term resistance
The XRP price has moved nearly 4% higher in around 90 mins on the back of Garlinghouse’s comments in Davos. The digital coin has now reversed this morning’s decline as it aims to recover from recent losses.
A few hours before Garlinghouse’s appearance in Davos, the XRP tagged an important horizontal support around the $0.2150 handle. This may provide an additional boost to bulls as new buyers have entered the race at a good level.
On the upside, the intra-day target is $0.2250, while the $0.2380 hosts the 100-DMA. The key short-term resistance sits around $0.2550, where the 200-DMA and the 2-month high are located. If the momentum persists, we are likely to see more and more investors buying the XRP.
The XRP price has rallied higher on Ripple CEO’s claims that the IPO may be organized in around 12 months time. The coin is now pushing higher with $0.2550 as the key short-term resistance and target for the bulls.