On-chain analytics platform CryptoQuant has revealed why the XRP price continues to crash and recently fell below the psychological level of $2. The platform has noticed this the XRP ETF approval has not stopped the selling pressure, but appears to have escalated it.
Why the XRP Price is Crashing Despite the Success of ETFs
In one CryptoQuant ReportAnalyst PelinayPA revealed that the XRP price is facing significant selling pressure from whales holding between $100,000 and 1 million XRP and whales holding more than $1 million. This XRP whales They are said to be responsible for most of the inflows into the crypto exchange Binance.
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These transfers indicate that these whales typically want to sell these coins, which puts selling pressure on the XRP price. PelinayPA noted that after each major inflow peak on the map, the XRP price forms a lower high and lower low structure, indicating that supply currently exceeds demand.
The CryptoQuant report noted that this is happening because there is no strong new spot buyer in the market. The continued rise of available offer It is also said to continue to push XRP lower even though the whales are not aggressively dumping. Meanwhile, PelinayPA highlighted the key price levels to pay attention to as prices continue to fall.
The analyst stated that, based on inflow intensity and price reactions, the first major support zone is between $1.82 and $1.87. She noted that this range indicated where the price briefly stabilized and where small buyers appeared. However, XRP still risks crashing to the $1.50 and $1.66 range if the large outflows continue. The chart does not indicate that the altcoin could rise quickly under this selling pressure.
Whales benefited from the ETF’s story
The CryptoQuant report stated that the XRP ETF process was theoretically expected to create institutional demand and drive up the price through spot buying. However, that has not been the case as there was high volume instead XRP inflow to Binance. PelinayPA explained that whales were the first to act as expectations for ETF approval increased.
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The analyst further revealed that XRP that was pre-collected for the ETF story was transferred to exchanges and used as sell-side liquidity. In short, whales sold the ETF approval story for private investors. As a result, the XRP price faces significant selling pressure whenever it approaches the $1.95 level.
PelinayPA reiterated that expecting a bullish move before currency inflows subside would be an unrealistic assumption. However, it is worth noting that the XRP ETFs have been successful so far and continue to pile on $1 billion in net assets in just over a month since their launch.
At the time of writing, the XRP price is trading around $1.90, up almost 4% in the last 24 hours. facts from CoinMarketCap.
Featured image from Getty Images, chart from Tradingview.com