Stella Riding the Halo of the 'Ripple Ruling'... Contrasting Trajectory with Stagnant Bitcoin

Bitcoin Price Gives Back Gains Amid Tightening Concerns
Stellar Surges Over 30% Thanks to Ripple Correlation

The virtual asset Ripple issuer Ripple Labs has effectively won the securities classification dispute lawsuit against the U.S. Securities and Exchange Commission (SEC), and the virtual asset Stellar, which was separated from Ripple, is gaining a halo effect. This contrasts with other virtual assets such as Bitcoin, whose prices rose after the victory but later gave back their gains.

Image source=Reuters·Yonhap News

According to the global virtual asset market status relay site CoinMarketCap as of 7:33 a.m. on the 25th, Stellar's price was recorded at $0.15 (approximately 192 KRW), up 12.83% compared to a week ago.

Stellar surged after the U.S. District Court for the Southern District of New York issued a summary judgment in the lawsuit between Ripple Labs and the SEC. Stellar, which was around $0.10 on the 13th of this month, rose to $0.16 the next day after the court effectively ruled in favor of Ripple Labs, and approached $0.18 on the 20th. Although it has slightly adjusted since then, it still remains over 30% higher compared to before the ruling.

The court ruled that while selling Ripple to hedge funds and other institutional investors violated federal securities laws, selling to general investors on virtual asset exchanges did not constitute a violation. This was seen as a de facto victory for Ripple Labs in the securities classification dispute. Expectations that the relatively less regulated U.S. Commodity Futures Trading Commission (CFTC) would handle the virtual asset market instead of the SEC acted as a positive factor.

However, concerns about a base interest rate hike ahead of the Federal Open Market Committee (FOMC) regular meeting are holding back momentum. The Federal Reserve (Fed) is expected to raise the base interest rate by 0.25 percentage points at this meeting, and although it is anticipated to be the last hike, some speculate there could be one more increase. As a result, Bitcoin’s price fell back to the $29,000 range, which was the price before the Ripple ruling.

Unlike many coins including Bitcoin, Stellar maintained its price gains due to its association with Ripple. Stellar is also called an upgraded version of Ripple. It is a virtual asset developed through a hard fork from the existing Ripple blockchain. A hard fork means splitting from the existing blockchain to create a new blockchain and reissuing cryptocurrencies. Stellar was created in 2014 by Jed McCaleb, a co-developer of Ripple, after leaving Ripple Labs, and currently ranks 21st in total market capitalization among virtual assets.

Stellar is regarded as having strengths in international remittance of virtual assets. While Ripple operated on a private blockchain method with limited participants, Stellar operates on a public blockchain method open to anyone. The network is decentralized, increasing reliability, and it is praised for enabling easy and fast virtual asset transfers with low fees.

Despite the commonality of being coins specialized in virtual asset remittance, Ripple and Stellar have different orientations. Ripple, ranked 6th in virtual asset market capitalization, aims to provide transparent and traceable services to customers through partnerships with financial institutions. It is expanding its ecosystem by cooperating with the existing financial sector. In contrast, Stellar is conducting pilot projects in regions such as Africa, where financial infrastructure is lacking, focusing on users there. Stellar’s goal is to provide affordable and convenient micropayment financial services in countries where banking systems are not properly established.

This content was produced with the assistance of AI translation services.