With the significant bearish pressure that has struck XRP, its market dynamics have shifted toward a negative outlook, causing several key metrics to plummet. One of the crucial metrics that has recently declined from higher levels is the Total Realized Capitalization by Age.
Overall XRP Realized Cap Decreasing
XRP’s market dynamics are demonstrating growing weakness, as indicated by a decline in its total Realized Cap. The drop coincides with a wider wave of volatility engulfing the cryptocurrency market, and XRP’s price fluctuations reflect holders’ increasing skepticism.
Glassnode, a leading financial and on-chain data platform, reported the shift in the total realized cap, signaling increasing selling pressure and waning investor conviction. With a waning realized cap and ongoing price fluctuations, the altcoin‘s price might witness a prolonged correction in the short term.
Prior to the drop in realized cap, Glassnode noted that the metric experienced a substantial spike during the massive surge in XRP’s price in February due to news regarding Ripple’s victory in its lawsuit against the United States Securities and Exchange Commission (SEC).
Data from the platform shows that the realized cap almost doubled from $30.1 billion to $64.2 billion, with $30 billion mostly coming from new investors. This short-term increase in capital points to a retail-led impetus, which has now subsided as inflows from new investors have decreased since February.
XRP’s realized cap cooling down after huge growth | Source: Glassnode on X
Taking a look at these investors’ behavior from the New Investor Realized Cap Share metric, holders supply greater than 6 months currently accounts for about 62.8% of the realized cap, which was previously at 23%.
According to Glassnode, this steady concentration of new holders is indicative of significant retail participation. While this might be an encouraging development, it also presents the risk of fragility because many investors have high-cost bases.
Glassnode further delved into XRP’s Profit/ Loss Ratio, highlighting a persistent decline in the metric since January this year. A drop in this measure implies that most holders are presently at a loss. It is often considered a sign of weak conviction, conditions seem more precarious and top-heavy with money being concentrated in new hands.
Will The Altcoin Recover The $3.30 Mark Shortly?
Without a doubt, XRP appears to have lost its bullish momentum, dropping by nearly 50% from its current all-time high. However, crypto analyst and trader Javon Marks claims there is still room for the token to grow as he foresees a potential rebound to the $3.30 level.
Javon Marks stated that the altcoin’s MACD is presently approaching a breaking point in addition to holding a crucial regular bullish divergence. Given the positive development, bulls might make a comeback with dominance and cause prices to resume their current major upward trend to $3.30 and beyond.
XRP trading at $1.7 on the 1D chart | Source: XRPUSDT on Tradingview.com Featured image from Shutterstock, chart from Tradingview.com
