XRP is witnessing an extraordinary surge and could have huge implications for the market. After climbing over 14% in the past 24 hours, it trades at $2.71 at the time of press, edging closer to breaking $3 resistance.
This surge has been fueled by heightened investor enthusiasm surrounding Ripple’s new RLUSD token launch. If XRP reaches $3, it will mark its highest price since 2018 and potentially trigger a significant short-squeeze event.
According to data shared by Ash Crypto (@Ashcryptoreal), a well-known crypto expert on X, over $272 million worth of XRP short positions are at risk of liquidation if the digital asset hits the $3 price point. The attached chart shows a cumulative short liquidation leverage build-up near this level, signaling a critical threshold for traders.
🚨 LIQUIDATION ALERT 🚨
$272,300,000 WORTH OF $XRP
SHORTS WILL GET LIQUIDATED
IF XRP HITS $3.XRP SHORT SQUEEZE IS HERE 🔥 pic.twitter.com/XiLJMgzbEH
— Ash Crypto (@Ashcryptoreal) December 17, 2024
At the time of Ash Crypto’s analysis, the digital asset traded at $2.677, and the climb has continued, as the community anticipates the launch of RLUSD. The stablecoin’s launch could flood the ecosystem with new investors, potentially driving XRP higher, and helping it cross the $3 threshold.
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A Short Squeeze
A short squeeze occurs when traders who bet against an asset (by shorting it) are forced to buy back at higher prices to cover their positions, driving the price further.
In XRP’s case, the sheer size of leveraged positions adds significant pressure to the market. Should the price surpass $3, this massive liquidation could amplify the asset’s upward trajectory.
The sharp price rally is not only technical but also fundamentally driven. Ripple’s RLUSD token launch has reinvigorated interest in XRP, with investors interpreting the development as a positive indicator for the broader Ripple ecosystem. This increased optimism has contributed to the momentum, attracting institutional and retail investors.
While the possibility of a short squeeze presents opportunities for XRP holders, it also introduces heightened risk for traders. High leverage is a double-edged sword—those on the losing side of such a market move will face significant losses.
Will the Short Squeeze Benefit XRP Investors?
The broader implications of this event could extend beyond XRP, influencing sentiment across the crypto market. A successful rally past $3 may signal renewed investor confidence in altcoins, particularly those linked to Ripple’s ecosystem.
As RLUSD’s popularity and adoption grow over the next few days, it could accelerate XRP’s surge, driving it closer to its all-time high of $3.84. Experts have projected that XRP can surpass Ethereum in this cycle, and the groundwork for this might be laid over the next few days if it can surpass $3.
Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.
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