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- The breach affecting Chris Larsen prompted a significant XRP sell-off on both Binance and OKX exchanges.
- Traders reacted to the breach by selling off XRP.
- The majority of the stolen XRP was liquidated, and Bitcoin withdrawals associated with the hack had repercussions on the broader crypto market.
In a significant development, the cryptocurrency market recently experienced a significant decrease in XRP token trading following a cybersecurity incident involving Chris Larsen, co-founder of Ripple.
Market analysis firm Kaiko released data revealing a substantial decline in the Cumulative Volume Delta (CVD) for XRP, indicating a pronounced sell-off, notably on exchanges like Binance and OKX. This sell-off, involving close to 100 million XRP tokens, has sparked concerns about the security of digital assets within the cryptocurrency ecosystem.
Significant change observed in XRP trading metrics
The decline in XRP’s Cumulative Volume Delta (CVD) became more pronounced starting from January 30, despite an initial surge in buying activity where over 20 million tokens were purchased on Binance alone. However, XRP’s value dropped by 4.58% on the same day, attributed to overall market volatility.
The situation worsened as news of the hack emerged, leading to a significant shift from net buying to net selling, especially on Binance and OKX exchanges. The breach, initially disclosed by on-chain investigator ZachXBT, involved Chris Larsen’s wallet but was mistakenly linked to Ripple. This revelation triggered a wave of sell-offs as traders and investors hurried to sell their XRP holdings amid rising uncertainty.
Further investigations by ZachXBT revealed that the stolen assets were spread across various exchanges and converted into different cryptocurrencies, exacerbating the downward pressure on XRP’s trading metrics.
Attempts to stabilize the situation
Despite efforts to restore stability, such as Binance freezing $4.2 million in XRP associated with the breach, the majority of the pilfered tokens had already been liquidated. ZachXBT’s inquiry revealed substantial Bitcoin withdrawals from exchanges, amounting to $73.3 million, likely proceeds from the sale of the stolen XRP.
These transactions, including sizable withdrawals from HTX, Gate.io, and Kraken, emphasize the extensive repercussions of the breach, extending beyond Ripple and its co-founder to affect the broader cryptocurrency market.
Consequences for the cryptocurrency community
This occurrence serves as a clear reminder of the persistent hurdles and dangers linked to digital asset security in the cryptocurrency industry. The swift market responses to breaches underscore the necessity for strong security protocols and clear communication.
As the cryptocurrency community confronts these challenges, it becomes more evident that prioritizing the protection of digital assets is crucial for maintaining investor trust.
