XRP Crashes Hard! $2.4B Wiped as $3 Price Target Slips Away

XRP just had one of its worst weeks in recent memory. While the rest of the crypto market took small dips, XRP plunged more than 13%, becoming one of the top losers among major coins.

Investors were hopeful it could push past $3 again, but instead, the token faced a sharp reversal triggered by a mix of insider moves, technical corrections, and weak fundamentals.

This crash wiped out $2.4 billion in open interest and reignited doubt about XRP’s next big move. Let’s explore what happened and why XRP is struggling to stay afloat.

If you are interested in crypto trading, explore Bitrue and enhance your experience. Bitrue is dedicated to providing safe, convenient, and diversified services to meet all crypto needs, including trading, investing, purchasing, staking, borrowing, and more.

Key Takeaways

1. XRP lost over 13% in a week, performing worse than most major cryptos, with open interest falling by $2.4 billion.

2. Large XRP transfers by Ripple co-founder Chris Larsen sparked fear of insider selling, adding to downward pressure.

3. Despite hype, on-chain adoption remains weak, with limited DeFi activity and no confirmed institutional use cases.

What Triggered XRP’s Sudden Crash?

XRP’s recent fall didn’t happen in isolation. Several events layered on top of each other created the perfect storm for this decline.

It started on July 17 when Ripple co-founder Chris Larsen transferred nearly $175 million worth of XRP to multiple wallets.

Out of that, $140 million made its way to crypto exchanges. While there was no official statement that Larsen was selling, the timing couldn’t have been worse.

XRP had just peaked above $3.60, and traders interpreted these massive transfers as a signal that insiders might be cashing out.

This quickly sparked fear across the market, leading many to sell before a potential dump. The result was a steep 10 to 14% drop in just a few days.

Another pressure point was how many XRP holders were already sitting on profits. Over 90% of XRP’s circulating supply had recently moved into profit territory, according to Glassnode.

When a large number of holders are in the green, they are more likely to take profits, especially if prices start to slip. That’s exactly what happened here. As prices pulled back from the highs, many short-term investors began offloading to protect their gains.

Lastly, XRP’s correction aligns with its short-term realized price bands. Many holders bought in the $2.30 to $2.80 range. So when XRP hit $3.66, that 20-30% profit margin looked attractive.

As the price dropped back toward their cost basis, these holders likely rushed to exit before losses returned.

Read Also: XRP to $5? Ripple’s Bullish Signals Ignite Price Hype

Derivatives Meltdown: $2.4 Billion Vanishes

The biggest shock came from the derivatives side of the market. XRP’s open interest dropped dramatically by $2.4 billion in just a few days.

This kind of drop signals a significant retreat from leveraged positions. It suggests that traders who were borrowing heavily to bet on XRP’s rise were forced to close out or were liquidated as prices fell.

1. XRP’s open interest dropped from $11.2 billion to $8.8 billion between July 18 and July 25.

2. Over $325 million in liquidations were recorded in the same period.

3. XRP derivatives contracts fell by 12% from their peak.

What’s interesting is that even after this plunge, open interest is still 48% higher than it was a month ago. That means many traders are still exposed, and if market volatility returns, another wave of liquidations could follow.

Some analysts are debating whether this was a healthy correction or the beginning of a bigger downtrend.

While we can’t say for sure yet, what’s clear is that the XRP market remains on edge. Even a minor dip in liquidity or a surge in selling pressure could set off another round of volatility.

Read Also: Can XRP Still Go Up After Whale Activity Decline?

On-Chain Signals Show Weak Adoption

Beyond the charts and order books, XRP’s current struggles point to a deeper issue: real-world adoption still hasn’t caught up with the hype.

Despite social media rumors about possible partnerships with banks or payment systems like SWIFT, none of these have been officially confirmed. And the data tells its own story.

1. Only $134 million in tokenized assets currently circulate on the XRP Ledger.

2. For comparison, Avalanche has over $190 million, and Sui processes more than $13.3 billion in 30-day decentralized exchange volume.

3. XRP doesn’t even rank in the top 50 blockchains by active DeFi use.

These numbers show that while XRP may be popular in trading circles, its use in real applications remains minimal. Even futures traders are cautious. The 3-month XRP futures are trading at a modest 6 to 8% premium, showing a lack of strong bullish conviction.

This disconnect between media hype and actual adoption is troubling. If XRP wants to sustain long-term growth, it will need more than just price rallies and speculative interest. It needs real users, real use cases, and steady demand, none of which seem to be taking off just yet.

Read Also: XRP News! Why is the XRP Price Down Today?

Conclusion

XRP’s steep drop over the past week is a wake-up call for traders and long-term holders alike. A combination of large insider transfers, profit-taking behavior, weak adoption data, and massive derivative liquidations all played a role in pulling the price down. While some bullish sentiment still lingers, the path ahead is far from certain.

For anyone trading crypto during volatile times like this, platforms like Bitrue make a real difference.

Bitrue offers a secure and easy-to-use experience with deep liquidity, low fees, and fast execution, perfect for navigating the ups and downs of assets like XRP.

Whether you’re holding long-term or managing short-term trades, Bitrue gives you the tools to stay ahead of the market.

FAQ

Why did XRP drop so sharply this week?

XRP fell more than 13% due to large transfers by a Ripple co-founder, a high percentage of holders taking profits, and a big drop in derivatives market interest.

What is open interest in crypto trading?

Open interest refers to the total number of active derivative contracts (like futures) that haven’t been settled. A sharp drop usually means traders are closing positions or getting liquidated.

Is XRP still a good investment?

XRP has potential, but recent events show that it remains highly volatile and speculative. Always do your own research and manage risk carefully.

How does XRP adoption compare to other blockchains?

XRP lags behind many blockchains in terms of decentralized finance activity and real-world usage. Its network has yet to show strong adoption metrics.

Where can I trade XRP safely?

Bitrue is one of the top platforms for XRP trading, offering strong security, fast trades, and a wide range of pairs for both beginners and pros.

Disclaimer: The views expressed belong exclusively to the author and do not reflect the views of this platform. This platform and its affiliates disclaim any responsibility for the accuracy or suitability of the information provided. It is for informational purposes only and not intended as financial or investment advice.