The recent ruling from Judge Analisa Torres declaring XRP programmatic sales as non-securities sparked a temporary rally in the token’s price. However, as the euphoria fades and the United States Securities and Exchange Commission (SEC) fights back, the price of XRP is once again correcting downward. This correction has prompted massive sell-offs of the token, with a recent transaction sparking bearish pressure. A single whale moved a significant amount of XRP tokens, totaling 29.3 million, to a centralized exchange, Bitstamp. This transfer, worth over $15.13 million at the time, has raised concerns among investors about a potential price decline.
Typically, when investors move their tokens to centralized exchanges such as Bitstamp, it is to sell them. Centralized exchanges offer lower fees and deeper liquidity, making it easier to execute large sell orders. With such a large stash of XRP tokens, further selling by the whale could lead to a significant price fall. Sell pressure of this magnitude could potentially cause the XRP price to decline by as much as 20%. The already struggling XRP price, combined with negative momentum in the broader crypto market and Bitcoin’s struggle to recover, makes this bearish scenario more likely. If the price continues to decline, it could easily fall into the $0.48 territory.
Despite the concerning sell-off, the bulls have not remained inactive. Shortly after the whale’s transaction, a massive buy order of $1.5 million worth of XRP was reported on the Bybit exchange. This substantial buy pressure led to two quick spikes in the XRP price, briefly reaching $0.5311 before retracing back downward. The presence of substantial buy pressure indicates that there are investors willing to counterbalance the selling by the whale. Furthermore, the token is still holding above its 200-day moving average, which suggests a relatively bullish sentiment in the mid-term. While a 20% decline may be expected due to the selling pressure, it is likely that the decline will not be long-lasting, and the digital asset will begin to recover.
The recent XRP transaction involving a significant amount of tokens being moved to a centralized exchange has raised concerns among investors about a potential price decline. Sell pressure from the whale selling could lead to a significant decline of up to 20% in the XRP price. Furthermore, the broader negative momentum in the crypto market and Bitcoin’s struggle to recover make this bearish scenario more likely. However, the presence of substantial buy pressure and XRP holding above its 200-day moving average indicate that the decline should not be long-lasting. While a correction is expected, the digital asset is likely to recover and regain its bullish sentiment in the mid-term.
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*Featured image from iStock, chart from TradingView.com*
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