XRP drops 8%, wiping out gains from ‘Hinman Emails’ in Ripple lawsuit.

XRP prices dropped 8.5% in just one day, making it the largest among all the major cryptocurrencies, as digital asset markets experienced a sudden sell-off on Wednesday.

The token’s value plummeted to as low as 46.18 cents, which is the lowest it has been this month, according to blockchain Indices data. On Tuesday, XRP was priced at almost 56 cents as traders placed their bets on a much-anticipated document release related to an ongoing lawsuit between payment firm Ripple Labs and the U.S. Securities and Exchange Commission (SEC) that could have potentially increased XRP’s value.

Read more: Why William Hinman’s Emails Matter to the XRP Army and the Crypto’s Price

The sharp decline in XRP’s value happened simultaneously with bitcoin (BTC) and ether (ETH), the two leading cryptocurrencies by market capitalization, losing key price levels on Wednesday afternoon after the Federal Reserve’s latest interest rate decision. Despite the Fed pausing its rate hike campaign after 14 months, which most traders thought would have a bullish effect on prices, BTC and ETH dropped below $25,000 and $1,700, respectively, to 3-month lows.

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The SEC sued Ripple in 2020, alleging that the firm sold unregistered securities, namely XRP. Ripple, however, has historically distanced itself from the token, which powers some of its products and the XRP Ledger network.

XRP rallied earlier this week amid the release of emails from William Hinman, former director of SEC’s Division of Corporation Finance. Optimistic traders bet that Hinman’s speech would underscore flawed reasoning by the SEC for deeming the token a security, pointing to a favorable outcome for Ripple Labs in its ongoing lawsuit between the firm and the SEC.

“Currently, we observe huge speculative narratives around Ripple, which could potentially lead to a significant price increase for XRP in the next three to four months, pushing its value to anywhere between $10 and $30,” crypto hedge fund manager Thomas Kralow said in a note earlier this week.

Edited by James Rubin.

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