bullish

Major

Bitcoin

April

<p>The recent euphoria surrounding XRP could quickly turn into disillusionment for optimistic investors. As the price of the cryptocurrency has dropped by 18% from its annual high, an expert warns of a possible “bloodbath” if Bitcoin’s dominance were to increase in the market.</p>
<h2 id="h-un-marche-crypto-euphorique-malgre-la-baisse">A euphoric crypto market despite the decline</h2>
<p>On December 3rd, the <a href="https://www.cointribune.com/en/xrp-outperforms-the-crypto-market-technical-analysis-of-december-4-2024/" target="_blank" rel="noopener noreferrer nofollow">XRP reached its highest level</a> of the year at $2.85, boosted by a spectacular bullish movement following Donald Trump’s electoral victory.</p>
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<p>The enthusiasm of investors does not seem to wane despite the ongoing correction, as evidenced by the record open interest of $3.44 billion recorded on December 5th on XRP derivative contracts. This level far exceeds the previous record of $2 billion observed in April 2021, signaling a possible “euphoria” in the market according to Hundal.</p>
<p>The situation becomes particularly concerning with the multiplication of long leveraged positions, even as the price continues to fall. “<em>We have seen many rapid purchases from retailers in recent weeks</em>“, <a href="https://cointelegraph.com/news/xrp-bitcoin-dominance-liquidations-crypto-analyst" target="_blank" rel="noopener noreferrer nofollow">highlights</a> the Swyftx analyst, pointing out the potential danger of such accumulation.</p>
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<h2 id="h-le-spectre-d-une-rotation-vers-le-bitcoin">The specter of a rotation towards Bitcoin</h2>
<p>The <a href="https://www.cointribune.com/la-domination-de-bitcoin-btc-diminue-t-elle/" target="_blank" rel="noopener noreferrer nofollow">dominance of Bitcoin</a> in the crypto market, currently at 55.30%, represents a growing threat to XRP holders. Industry experts foresee a possible increase in this dominance up to 60-70%, which could trigger a massive movement of capital from altcoins to bitcoin.</p>
<p>This potential rotation is particularly concerning due to the levels of leverage currently used on XRP. A simple decrease of 7% from the current price, bringing it down to $2.18, would be enough to trigger the liquidation of long positions amounting to $104.4 million.</p>
<p>High funding rates on several exchange platforms, exceeding 50% on the annual heat map, confirm the “exuberant” nature of the current market. Only a <a href="https://www.cointribune.com/en/bitcoin-derivatives-a-key-indicator-of-the-next-step/" target="_blank" rel="noopener noreferrer nofollow">stabilization of Bitcoin</a> could, according to Hundal, “calm the nerves” of investors and allow for a healthy recovery of spot volumes.</p>

Crypto: XRP Facing Major Risk!

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