Whale sell-offs risk sending XRP’s price into free-fall just three weeks after reaching a new peak for the first time in seven years.
That’s because XRP whales have been booking profits since the cryptocurrency peaked at $3.65. They’ve sold $6 billion worth of XRP since mid-July, Santiment data shows.
Market data from CryptoQuant also backs it up with massive outflows from large wallets, a clear sign of coordinated offloading by whales.
“Unless we see sustained positive whale flows [greater than $15 million per day], the market may remain structurally weak,” CryptoQuant analysts said. “At present, there is no sign of consistent accumulation from large holders, a key component of a constructive trend reversal.”
If the pattern holds, a massive price correction could be imminent for XRP.
Even Ripple co-founder Chris Larsen seem to have offloaded $26 million worth of XRP last month. Ripple created XRP to facilitate cross-border transactions.
The last time whales booked profits en masse, XRP fell 40% after climbing as high as $3.36 in January.
On Thursday, XRP traded slightly above $3, 4% uptick in the last 24 hours but the price is still down 18% from its all-time high in July.
XRP’s structural weakness appears to be a common theme for altcoins.
Bitfinex analysts previously told DL News that the altcoin market doesn’t yet have the “sustained capital and structural demand” needed to trigger massive price gains and that until the situation changes, altcoin rallies will remain “short-lived and vulnerable to broader market pullbacks.”
Despite the ominous signs, traders are piling into optimistic bets on XRP perpetual contracts. Perpetuals are futures contracts without expiries.
Data from Coinglass shows almost twice as many traders are long on XRP shorts compared to those who bet on a price fall for the cryptocurrency. That’s a much larger ratio of bullish to bearish bets compared to the data from Bitcoin and Ethereum, where the split is much narrower.
On the options side, traders seem to have converged on $3.2 as an important price level for XRP, with more than $8.4 million in trading volume at that price mark for short-term contracts expiring at the end of August.
