Three Possible Reasons XRP Is Falling Deeper Than the Rest of the Market

The crypto market has faced weeks of selling pressure, but $XRP appears to have taken a much bigger hit than most major assets.

While Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) have also recorded heavy losses, $XRP has fallen much further, and this has led to questions about why it is struggling more than the rest of the market.

$XRP Falling Deeper Than the Market

In a recent analysis, market expert EGRAG Crypto highlighted this trend. According to him, since Nov. 4, $XRP has lost 23.4%, while Ethereum has declined by 18.2%, Solana by 17%, and Bitcoin by 10.4%.

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At the time of reporting, $XRP had fallen to around $1.06, bringing its weekly losses to 15.4% and its monthly decline to nearly 25%.

The continued selling has also pushed $XRP below three major moving averages. The asset now trades below its 20-day moving average at $1.25, its 50-day moving average at $1.36, and its 200-day moving average at $1.27.

To explain why $XRP is falling harder than other major cryptocurrencies, EGRAG presented three possible reasons, including leverage flush, selling from early holders, and market manipulation.

Leverage Flush (30%)

EGRAG gives the derivatives market a 30% chance of being behind $XRP’s deeper losses. He mentioned forced closures of leveraged long positions and weak buying demand as factors that may be making the decline worse.

According to CoinGlass, exchanges liquidated nearly $39 million in leveraged $XRP long positions on Nov. 8 alone. By comparison, short liquidations amounted to just $366,000. This means exchanges closed almost 33 times more long positions than short positions during the period.

When traders use borrowed funds to bet on higher prices, a sudden move in the opposite direction can leave them unable to meet their margin requirements. Exchanges then automatically close their positions, adding more sell orders to an already falling market. This pushes prices lower and triggers further liquidations.

However, the Nov. 8 liquidations may not have removed all the risk from the derivatives market. Considerable modeled long exposure remains below $XRP’s current price, and this suggests that more leveraged positions could still face liquidation if the decline continues.

Early Holders Cashing Out (20%)

The second possible reason is selling by early $XRP holders, which EGRAG assigns a 20% probability.

These investors bought $XRP at much lower prices and may still be sitting on substantial gains despite the recent decline. Some could now be taking profits and moving their money into other assets.

Unlike forced liquidations, which can cause sudden price drops, selling by long-term holders may happen gradually. Investors with large holdings could distribute their tokens over time without attracting much attention. However, their continued selling still adds pressure to the market.

Manipulation (50%)

EGRAG gives market manipulation the highest probability at 50%, and this makes it his leading explanation for $XRP’s underperformance.

He believes large market participants could be targeting liquidity to force smaller investors out of their positions before the price finds a bottom.

Data from CryptoQuant shows that large whale transactions in $XRP’s spot and futures markets currently lean toward selling. This indicates growing selling pressure among major market participants and adds to the concerns surrounding $XRP’s current market position.

On-chain analysts have also flagged unusual whale activity linked to sharp changes in liquidity across major exchanges. Large holders have reportedly moved billions of $XRP, potentially influencing price movements and taking advantage of areas where market liquidity is weak during important trading sessions.

EGRAG believes these moves could be part of an attempt to scare retail investors into selling their holdings at lower prices before larger players begin accumulating.

If large holders are absorbing the available supply, it could point to a possible stabilization or price reversal. But if they are selling alongside other market participants, $XRP could face further losses.

$XRP Price Levels to Watch

EGRAG mentioned the $1.00-$1.04 range as an important area where $XRP needs to find support. Buyers must defend this zone to prevent a deeper decline. If the price begins to recover, bulls will first need to push $XRP above $1.15 before attempting to reclaim $1.25.

If selling continues, the next major support level sits near $0.99. This is particularly important because it represents $XRP’s lowest closing price in more than a year.

Institutional demand could also play a role in determining whether $XRP recovers. A return of inflows into spot $XRP ETFs may provide additional buying support.