XRP’s price surged alongside the broader cryptocurrency market on August 20, recovering more than $9 billion of its market capitalization in 24 hours as macroeconomic tailwinds, short liquidations, and renewed presidential support for digital assets drove risk appetite higher.
In particular, XRP’s market cap rose from roughly $63.08 billion at 11 a.m. (UTC), August 19, to $72.27 billion at 11 a.m. (UTC), August 20, a 14.5% change of nearly $9.2 billion.
At the same time, XRP’s price itself shot up from $0.99 to $1.15 at the time of writing, a psychologically important level not seen since July 21, per CoinMarketCap data.
Why is XRP rallying today?
The XRP price rally comes as the crypto sector receives another potential catalyst from Washington, as President Donald Trump has called for Congress to pass the CLARITY Act.
Speaking at a White House event attended by some of the sector’s biggest executives, Trump urged lawmakers to move forward with the legislation, which is shaping up to be one of the most important milestones for the industry.
“Now we need Congress to take the next step by passing the CLARITY Act, fair version of the CLARITY Act,” Trump said on August 19.
Meanwhile, reports that the U.S. Treasury would double its long-term bond buybacks helped push yields lower, improving the appeal of risk assets. The move triggered a powerful short squeeze, with more than $1.57 billion in crypto positions liquidated over 24 hours.
As a result, Bitcoin (BTC) jumped 11.01% just as U.S. spot Bitcoin ETFs recorded roughly $517 million in net inflows on August 10, per SoSoValue, while the total cryptocurrency market capitalization climbed just shy of 10%.
XRP price outlook
According to the most recent Coinalyze data, XPR spot volume climbed to the highest level in the last two months above $610 million on August 19.
Meanwhile, XRP derivatives traders remain overwhelmingly bullish, with longs accounting for 73.34% of positions over the past 24 hours, against 26.58% in shorts.
The long-to-short ratio points to strong upside conviction, although the heavily skewed positioning also leaves XRP vulnerable to a long squeeze if the rally loses momentum.
A decisive XRP close above $1.13 could strengthen the setup and put the $1.17 and $1.22 Fibonacci extension levels in focus. However, a break below $1.08, the 38.2% retracement level, would instead suggest that momentum is beginning to fade.
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