XRP Faces Steep Decline Amidst Whale Sell-Off

Analyst Warns of Further Drops as Key Support Levels Tested

The price of XRP has seen a significant downturn, plummeting over 20% since mid-July. Crypto analyst Ali Martinez indicates that this pullback could intensify if crucial support at $2.8 fails to hold.

Whale Holdings Trimmed, Bearish Signals Emerge

Large-scale holders, specifically those with 1 million to 1 billion XRP tokens, have been reducing their positions. Over the last three weeks, these “whale” wallets have decreased their holdings by approximately 2 billion XRP, equating to roughly $6 billion sold. This distribution event, coupled with a bearish MVRV death cross signal, suggests continued dominance by short sellers.

Martinez highlighted that the MVRV death cross, a bearish indicator, was recently activated. This technical signal previously preceded a more than 30% price drop for XRP in late March, moving from $2.4 to $2.0. If history repeats, a further discount could present a buying opportunity.

The MVRV Z-Score for @XRP_Network just flashed a death cross. pic.twitter.com/pT4VfQk5qV

— Ali Martinez (@ali_charts) August 1, 2025

Potential Downside Targets Identified

At the time of reporting, XRP was trading around $2.9. Martinez identified $2.8 as immediate support, but a more significant floor may lie at $2.48 based on on-chain data. This level is where a substantial number of current holders acquired their XRP, making it a critical zone to monitor for potential buying interest.

Technical analysis also points to similar levels around the 200-day Simple Moving Average (SMA), indicating XRP could face an additional 15% decline if broader market sentiment turns negative. For instance, the S&P 500 experienced a 1.2% dip on August 6th, 2025, reflecting potential market-wide headwinds (Source: TradingView data as of August 6, 2025).

Mixed Signals from Traders

Despite the bearish indicators, some traders appear to be accumulating XRP. Smart money on Binance has increased long positions from 64% to 69% in the past two days, reversing a trend of trimming long positions that occurred between mid-July and early August. This suggests a segment of traders believes XRP has found its bottom and is poised for a rebound.

The overall market sentiment for XRP is currently mixed, with significant selling pressure from large holders counterbalanced by increasing retail interest at lower price levels. The critical support at $2.8, and potentially $2.48, will be pivotal in determining XRP’s short-term trajectory amidst broader cryptocurrency market uncertainty.