XRP, once a formidable player in the cryptocurrency landscape, is grappling with a prolonged period of decline. Prices continue to slide, market dominance dwindles, and a concerning trend emerges – large holders known as ‘whales’ are increasingly shedding their XRP holdings. These factors, despite a surge in on-chain activity, paint a worrisome picture for the future of the asset. XRP whales selling their holdings only adds to the mounting challenges.
Top six coins by Markertcap. Source, Coinmarkertcap
XRP Whales Sell Their Holdings as XRP Trails Competitors
CoinMarketCap reveals a worrying picture for XRP. The cryptocurrency has been drastically underperforming compared to its larger counterparts in recent weeks, gaining only a modest 4%. This stands in stark contrast to significant rallies seen in Bitcoin, Ethereum, and others. The SEC lawsuit against Ripple, along with the lingering bear market, has contributed to XRP’s struggles. Its market value has plummeted since its January 2018 peak.
XRP Whales and Regulatory Woes
XRP’s struggles are not new, with the cryptocurrency grappling with the aftermath of a Securities and Exchange Commission (SEC) lawsuit against Ripple, its parent company. The lawsuit, coupled with the bear market of 2022, has taken a toll on XRP’s value. It has lead to a significant decline in market dominance for XRP from a peak of 30% in 2017 to a mere 1.48% as of February 2024.
XRP/USD daily price chart. Source. TradingView
Furthermore, the impending grand trial scheduled for April 23, 2024, adds another layer of uncertainty to XRP’s future. Despite securing partial victories in court last year, Ripple’s legal battle with the SEC remains unresolved, leaving investors wary of potential regulatory repercussions.
Adding to the concerns, insights from Santiment reveal a worrying trend of XRP whales and major cryptocurrency holders selling their holdings. The data indicates a decline in confidence, with the percentage of XRP supply in profit dropping from nearly 90% to below 80%. Such a downturn suggests that whales are divesting their holdings, painting a bearish outlook for XRP’s prospects.
Historically, after BTC halving, XRP has often recorded huge price surges, sometimes even surpassing those of BTC. However, whether the same trend will reoccur remains uncertain amidst the current challenges.
A Glimmer of Hope?
While the situation appears bleak, there might be a glimmer of hope for XRP. The International Monetary Fund’s (IMF) recent report highlights the importance of digital currencies and mentions Ripple’s collaboration with Palau on a sovereign stablecoin project. While this could provide positive attention, it remains to be seen if XRP can overcome its current hurdles.
