The cryptocurrency market faced a seismic shift this week as prices plunged across major tokens. Following a steep 11% drop in global market capitalisation, now at $3 trillion investors are questioning whether XRP or Ethereum (ETH) present buying opportunities. Below, we dissect the factors driving the chaos.
Markets Crash Under Macroeconomic Pressure
Cryptocurrencies tumbled sharply Monday after U.S. President Donald Trump announced tariffs on imports from China, Canada, and Mexico. Consequently, Bitcoin sank to $91,242, while Ethereum plunged 30.85% to $2,163.80—levels unseen since September. Analysts link the crash to macroeconomic fears, including rising bond yields and a hawkish Federal Reserve. Meanwhile, over $2 billion in crypto positions were liquidated within 12 hours, amplifying volatility.
Whales Accumulate XRP Amid 42% Drop
XRP nosedived 42.5% this week, sliding from $3.38 to $1.94. Despite this, blockchain data reveals whales are aggressively accumulating the token, signalling confidence in a rebound. However, analysts warn of risks: a close below $1.96 could trigger deeper losses. Conversely, bullish forecasts suggest XRP might hit $3.81 by 2025 if it overcomes its ongoing SEC legal battle.
Ethereum Tests Key Support
Ethereum mirrored the broader sell-off, falling 30.85% to $2,159. Like XRP, ETH faces bearish momentum. Nevertheless, long-term proponents argue ETH’s fundamentals including its role in decentralised finance remain intact. “This dip could reward patient investors,” remarked one trader. Notably, ETH’s 24-hour trading volume surged 178%, reflecting heightened market activity.
Trade Wars Fuel Crypto’s Risk-Off Sentiment
Trump’s tariffs sparked fears of inflation and stunted economic growth, driving investors toward stablecoins now dominating 92.37% of daily crypto volume. Additionally, Bitcoin’s dominance climbed to 61%, underscoring a flight to perceived safety. “The Asia open saw one of the largest liquidations ever,” stated CoinSwitch, linking the sell-off to geopolitical tensions. Gold’s simultaneous rally to record highs further highlights the market’s risk-averse tilt.
When can we expect a recovery?
Experts remain divided on crypto’s path forward. Avinash Shekhar, CEO of Pi42, noted, “Macro factors dictate digital assets’ fortunes. A Bitcoin rebound above $100,000 could reignite momentum.” However, regulatory hurdles loom: India’s 2025 budget introduced stricter crypto compliance rules, dampening sentiment. For XRP, legal clarity remains pivotal, while Ethereum’s outlook hinges on adoption trends.
Altcoins in Liquidation Storm
Beyond XRP and ETH, altcoins suffered staggering losses. Solana, Cardano, and Dogecoin plummeted 8.8%–27%, while meme tokens like OFFICIAL TRUMP sank 16%. Notably, stablecoins $272 billion trading volume eclipsed volatile assets, emphasising investor caution. “This correction was overdue,” argued one analyst, citing January’s euphoric rally.
In Conclusion
While XRP’s whale activity and Ethereum’s long-term potential hint at opportunities, risks abound. Investors must weigh macroeconomic headwinds, regulatory shifts, and technical thresholds. For those with high risk tolerance, buying the dip could pay off, but only if markets stabilise. As Trump’s policies unfold, volatility will likely persist, demanding disciplined entry points and diversified portfolios.
Written By Fazal Ul Vahab C H
