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Leveraged XRP bulls could face a “bloodbath” if Bitcoin dominance starts to rise again, says Swyftx lead analyst Pav Hundal.
“The real danger right now for highly leveraged XRP bulls is that Bitcoin dominance increases again,” Hundal said in a recent interview with CoinTelegraph. “A rotation from XRP to Bitcoin would very likely lead to a bloodbath of liquidations.”
“Thirst For Leveraged Long XRP Exposure” Could Put Traders At Risk
XRP has soared over 43% in the last week to trade at $2.33 as of 2:28 a.m. EST, but is down more than 19% since reaching a weekly high of $2,9092 on Dec. 3, according to CoinMarketCap data.
Meanwhile, Bitcoin dominance has dropped over 4% in the last week and more than 8% in the last 30 days to stand at 55.37%.
Despite the drop in XRP’s price in the last couple of days, Hundal noted that there is still a “thirst for leveraged long XRP exposure.” The analyst added that XRP longs were “reloaded” even as prices dropped since the Dec. 3 peak.
Retail traders have also engaged in “quick twitch buying” in the last few weeks, the analyst said, causing open interest in the market to soar to almost double the levels seen in 2021. Hundal concluded that the market might be approaching “euphoria territory.”
Bitcoin Wipes Out $303 Million In Long Positions
On Dec. 5, Bitcoin wiped out $300 million in long positions after a more than 5% drop to below $93K within minutes. Bitcoin’s price has since rebounded to above $98K as large corporations and whales identified the correction as a buying opportunity.
🚨 Blackrock Buys 7750 #Bitcoin
They hold over $50 Billion in Assets.
Fastest growing ETF EVER! 🔥 pic.twitter.com/uJU9MLTlTb
— Thomas | heyapollo.com (@thomas_fahrer) December 6, 2024
Asset management titan BlackRock, as well as MARA Holdings and an unknown whale collectively bought 9,1773 Bitcoins yesterday.
The rebound in BTC’s price could set the leading crypto back on its positive trajectory, leading to an increase in the crypto’s dominance and the potential “bloodbath” that Hundal is flagging.
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