Bitcoin rival token XRP and “meme” currency Dogecoin both soared on Monday, as amateur investors zeroed in on new assets in the wake of the GameStop saga and Elon Musk boosted interest in cryptocurrencies.
XRP was up as much as 50% before abruptly falling again. It was last up 21.27% to $0.59668 per coin at 7.50am ET.
Dogecoin was 28.36% higher at $0.03929, after falling sharply from a high of more than $0.07 on Friday. Bitcoin, the biggest cryptocurrency by market value, was down 0.89% to $33,726.
Last week, day traders on the Reddit forum Wall Street Bets sent the shares of video-game store GameStop soaring in an effort to squeeze hedge funds that had been betting against the stock – and to make themselves lots of money.
Read More: A chief investment strategist breaks down how the GameStop saga could upend long-standing practices on Wall Street – and shares her 4-part advice for navigating the frenzied trading environment
The army of amateur investors appeared to have locked on to a broader array of targets on Monday, with silver hitting its highest level in 8 years and XRP and Dogecoin both jumping.
XRP is both a cryptocurrency and digital payments network created by US firm Ripple. It tumbled last year after the Securities and Exchange Commission announced a lawsuit against Ripple for allegedly conducting an unregistered securities offering, which Ripple denies.
Dogecoin is a “meme” cryptocurrency created in 2013, seemingly as a joke, but which has picked up a growing following. A cryptocurrency is a secure digital currency, often without a central controlling authority.
Tesla founder Elon Musk has encouraged the recent surge in interest in cryptocurrencies. In a Sunday night video on the app Clubhouse, Musk said it would be funny if “Dogecoin becomes the currency of Earth in the future.”
Part of the XRP price rise was driven by a concerted effort among the currency’s fans, echoing the GameStop phenomenon. A group on the messaging app Telegram called Buy & Hold XRP hit the maximum 200,000 member threshold.
Yet the strategy looked shaky shortly after 7am ET, as the price fell back sharply. One Reddit user said: “Alright, I wanna know who did it. Who dropped xrp from 74 cents to 60? I’m not mad I just wanna talk.”
Naeem Aslam, market analyst at Avatrade, said small retail traders “love” XRP as it is cheaper than Bitcoin but has a reasonably large market capitalization.
“If [Ripple] wins its case against the SEC, we could see some serious upward moves for the XRP,” he said.