**XRP Whales Trim Their Holdings Amid Market Fluctuations**
This week, XRP whales have notably decreased their holdings in response to a significant market downturn. However, there’s a silver lining: today, XRP has bounced back following a sharp sell-off on Tuesday, registering a 3.7% increase in the last 24 hours. As of now, XRP is trading at $2.30, a slight recovery from its earlier low of $2.08. Despite this positive movement, XRP is still down 9.5% over the past week and 19.4% over the last 30 days.
**XRP Whales Reduce Holdings**
In the midst of XRP’s price decline, market data reveals a considerable drop in the holdings of XRP whales. According to a tweet from Ali Martinez, wallets containing between 10 million and 100 million XRP have been reducing their portfolios. This trend began around February 21, when these wallets held approximately 6.94 billion XRP. By February 25, that number had decreased to nearly 6.56 billion XRP. This represents a significant reduction of over 370 million XRP, equating to about $851 million in just 96 hours, indicating ongoing selling pressure from large investors.
**Market Sentiment Turns Bearish**
The overall sentiment in the crypto market remains quite bearish, with XRP facing increased fear, uncertainty, and doubt (FUD). An analysis from Santiment points out that trader sentiment has turned extremely negative, mirroring Bitcoin’s decline to $86,000. XRP, along with Bitcoin, Ethereum, and Solana, has seen social discussions largely filled with pessimism. Historically, such levels of bearish sentiment have often coincided with market bottoms, leading to speculation about a potential reversal on the horizon.
**Potential Oversold Conditions for XRP**
In another development, XRP’s open interest-weighted funding rate, an important indicator of market sentiment, has turned negative. Throughout January and most of February, this funding rate remained positive. However, recent data indicates a shift, with red bars now signaling bearish sentiment. Historically, negative funding rates have often preceded price reversals, as excessive shorting can trigger a short squeeze when buying pressure increases. Previous instances of this trend have shown that XRP prices tend to recover shortly after the funding rate turns negative. Given the current market conditions, there’s a possibility that a reversal could be on the way if short positions become overly crowded.
