The recent price decline of XRP has sparked a discussion among market experts regarding whether the decrease to $1.76 was a natural market reaction or a more deliberate event.
Within three hours on February 3, 2025, XRP experienced a rapid decline from $2.57 to $1.76, a staggering 31% decrease. Nevertheless, the rapid recovery above $2 that occurred shortly after the decline was a cause for concern.
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The price movement has been the subject of speculation, with some positing that external factors, rather than organic selling pressure, were responsible.
“The move yesterday was manipulated”
Let me explain my thoughts and why I was somewhat confident to call a low within 3 minutes last night (read until end)
Using $XRP for example
I think yesterday was a cohort effort of market makers to simultaneously let altcoins fall into… https://t.co/WOW4EB3QAE pic.twitter.com/y6ngsHrxl8
— Dom (@traderview2) February 3, 2025
Market Professionals Express Apprehension Regarding Manipulation
Among the first to spot anomalies in XRP’s price behavior was crypto analyst Dom. He noted that the price drop followed an odd trend whereby liquidity seemed to disappear during the last leg of the collapse.
He thinks it is possible that market players purposefully delayed buy-side liquidity, allowing the price to collapse and then tactically running purchase orders at reduced levels to profit on the comeback.
“I don’t want to resort to conspiracy but if you think that move was “natural”, think again. It simply looks to me like a cohort effort to crash altcoins WHILE filling their own bids,” Dom said on X.
Furthermore notable was the fact that the drop in XRP did not seem to be isolated. Another market guru, Vincent Van Code, noted over the same period that Bitcoin, HBAR, and several other cryptocurrencies had quite comparable price swings. This spurred questions about coordinated market behavior or automated trading.
The Mysteries Are Further Complicated By Synchronized Market Movements
Unless there are outside factors actively impacting price behavior, there is a statistically little chance that several cryptocurrencies would see the same sharp collapse and recovery in the same time periods.
Although algorithmic trading sometimes creates correlation across assets, experts argue that the accuracy of these movements suggests a deeper degree of coordination.
Dom emphasized that although panic selling and abrupt liquidations may be factors in these declines, the event’s structure and pace make it unlikely that natural market forces were the only factor.
It is possible, Dom said, that market makers are manipulating XRP to accumulate it at discounted prices, if they do indeed remove liquidity to facilitate a price decline.
“Whether that was the low or not, these players are UP BIG!,” the analyst said.
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What This Means For XRP Investors
This incident reminds XRP holders of the volatility of cryptocurrency markets. Whales or institutional players may be abusing their power when there are abrupt price drops and recoveries. Investors should employ prudence when dealing with unpredictable markets and consider using tools like stop-loss orders to lower their risks.
XRP has subsequently returned beyond $2, but the question of whether this was a planned move or a normal market correction is still up for debate.
Featured image from Gemini Imagen, chart from TradingView
