XRP investors faced a brutal sell-off this week as the token’s market capitalization nosedived by $18.37 billion in just 24 hours. The cryptocurrency now stands at $190.4 billion, with prices dropping 9.6% to $3.21 despite recent gains.

Liquidation Crisis Worsens Sell-Off

The downturn triggered a massive liquidation imbalance:

• $37.85 million in long positions wiped out
• Only $360,000 in short positions affected
• 10,409% disparity between longs and shorts

With long positions averaging 100x larger than shorts, the market became hypersensitive to downward pressure. This leverage overload turned a minor dip into a cascading sell-off.

SEC’s “Bizarre” ETF Reversal Adds Pressure

The sell-off intensified when the SEC suddenly blocked Bitwise’s ETF conversion on July 22:

• Would have included XRP alongside BTC and ETH
• Reversed just hours after initial approval
• Follows similar pattern with Grayscale’s GDLC ETF

ETF analyst Nate Geraci called the move “bizarre,” especially given the SEC’s recent pro-crypto posture. The affected fund manages $1+ billion in assets and rebalances monthly.

What’s Next for XRP?

While Polymarket traders still give an 85% chance of 2025 approval, analysts warn of delays:

• Awaiting SEC’s new listing framework
• Final decision on Bitwise’s ETF due by October 2025
• Price remains vulnerable to regulatory shifts

Key levels to watch:

• Current price: $3.21 (down 9.6%)
• Next support: $3.00 psychological level
• Resistance: $3.50 recovery benchmark