Key Insights
Is XRP Resilient Compared to Other Top Cryptos?
Despite a 12% pullback, XRP is performing better than Ethereum and seems to be decoupling due to increased XRPL inflows.
Is the Capital on XRPL Sustainable or Opportunistic?
Total Value Locked (TVL) has decreased, wallets are leaning towards long positions, and funding rates suggest bullish sentiment, but commitment is still shallow.
The market sentiment has turned risk-off, causing top cryptocurrencies to break support levels.
Ripple [XRP] is no exception, experiencing an 11.8% weekly decline and losing the $2.6 support level. On the other hand, Ethereum [ETH] has seen a larger drop of 14%. Therefore, XRP is relatively stronger in this period.
However, the selling pressure is not over yet.
As short-term volatility continues to drain capital from the market, the performance in Q4 will depend on the ability to maintain long-term conviction. Is Ripple leading this divergence?
XRPL Wallet Growth Reaches New Highs
XRP and XRPL are starting to detach from the broader market trends.
While XRP has declined by 12% recently, XRPL is still attracting new investments.
If this trend persists, it could help XRP’s price recovery and potentially position it ahead of other blockchain networks.
Supported by data from Santiment, there has been a consistent increase in new wallets on XRPL, reaching the highest level since February.
Source: Santiment
In summary, XRP’s relative strength is not accidental but is supported by strong on-chain fundamentals. For instance, the stablecoin market cap on XRPL has surged by 44%, reaching a new ATH of $307 million.
With the increase in new wallets, it indicates renewed accumulation, which could stabilize XRP’s support levels and potentially lead to a reversal in trends. The question remains: who is driving this accumulation?
Are New Investors Seeking Quick Profits or Building Long-Term Positions?
As mentioned earlier, having conviction during market fluctuations is crucial.
Ripple seems to be defying the trend as the Total Value Locked (TVL) on XRPL has dropped by 6%, indicating weak long-term commitment.
In essence, most inflows currently seem opportunistic, with traders rotating capital for short-term gains rather than long-term holding. Consequently, traders are biased towards long positions.
Source: Coinglass
On a shorter timeframe, XRP’s funding rates have turned positive, indicating a bullish sentiment. However, high funding rates also suggest the risk of overcrowded long positions, which could lead to a squeeze if the momentum changes.
Moreover, wallet counts on XRPL have decreased, highlighting weak long-term positioning. With traders heavily skewed towards long positions, XRP might struggle to reclaim $3.
text:
Please rewrite the following text:
“The quick brown fox jumps over the lazy dog.”
Rewritten text:
“The fast brown fox leaps over the sluggish dog.”