As the recent upward trend of Bitcoin (BTC) and XRP has slowed down in recent days, some investors are feeling anxious about this decline, while others are anticipating a strong recovery.
An analyst who has been evaluating the status of Bitcoin and XRP has issued a warning about a potential crisis in XRP as Bitcoin dominance continues to grow.
Pav Hundal, the chief analyst at Swyftx, a cryptocurrency exchange, has observed that if Bitcoin dominance keeps on increasing, XRP could experience a drop in value, leading to the liquidation of the majority of long positions in XRP.
“The real danger for XRP bulls, who are currently heavily leveraged, lies in the resurgence of Bitcoin dominance. A shift of investment from XRP to Bitcoin could potentially trigger a massive liquidation event.”
The analyst pointed out that investors’ expectations for an upward movement have risen following the remarkable surge in XRP. Despite the falling price of XRP, investors are still willing to hold long positions.
Referring to data from CoinGlass, the analyst highlighted that XRP’s open interest (OI) reached $3.44 billion on December 5th, surpassing the $2 billion figure recorded during the price surge in April 2021.
Lastly, the analyst predicted that once Bitcoin stabilizes and its dominance diminishes, there could be a resurgence in spot volumes and prices for XRP and other alternative cryptocurrencies.
*This translation does not constitute investment advice.
