Institutional XRP bagholders are abandoning ship as the US Securities and Exchange Commission (SEC) comes after the Ripple hierarchy for selling unregistered securities.
Bitwise Ditches Altcoin #2
According to a press release issued on Dec. 23, Bitwise Asset Management — a crypto hedge fund — has exited its XRP investment position. Following the move, XRP is no longer a part of its Bitwise 10 Crypto Index Fund.
As part of the press statement, Bitwise revealed that its XRP holdings before the sale accounted for 3.8% of the Fund. The company also revealed that the proceeds from the XRP liquidation had been reinvested into other assets.
Commenting on the reason for liquidation, the company commented:
“The Bitwise 10 Crypto Index Fund does not invest in assets that are reasonably likely to be deemed securities under federal or state securities laws. Bitwise’s decision to liquidate its position in XRP was based on consideration of new public information from the SEC’s complaint.”
As previously reported by BeInCrypto, the SEC lodged a complaint against Ripple for selling XRP as unregistered securities to the tune of $1.3 billion. The probe comes after years of speculation about whether the Commission would classify the token as a security.
Back in October, Ripple announced that it was considering a move outside of the US due to the lack of regulatory clarity in the country. Earlier in December, the company revealed that only 5% of its customers were located Stateside.
XRP Decline Continues
The negative sentiment occasioned by Ripple’s recent events is also causing significant downward pressure on XRP price action. Indeed, as of press time, the fourth-largest crypto by market capitalization is down over 25% against bitcoin (BTC).
With XRP plummeting and bitcoin attempting another assault at the $24,000 price mark, BTC’s market cap dominance could reach 70% for the first time since Mar. 2017.
Some see dominance based on market capitalization as a flawed metric. However, as BTC reclaims the 70% dominance mark, charts suggest that an altcoin run may not be on the cards anytime soon.