XRP's rally to $1.70 ended in a sharp weekend crash as leveraged long positions were liquidated. XRP is now trying to stabilize after the major derivatives reset.
XRP$1.47-2.13%XRP's powerful August rally came to an abrupt pause over the August 22 weekend as a sharp flash crash triggered a major liquidation event across the crypto market. After climbing roughly 60% during the previous week and reaching a seven-month high near $1.70, XRP quickly fell into the $1.46 - $1.51 range, flushing out heavily leveraged traders.
The move highlights how quickly a crowded rally can reverse when excessive leverage builds up. I’m checking the latest relevant market and liquidation data to keep the rewritten article focused and accurate, while also identifying the strongest internal backlinks from your recent articles.
XRP's explosive rally hit a sudden roadblock over the August 22 weekend after a sharp market-wide sell-off triggered a major wave of liquidations.
The token had rallied more than 60% in the days leading up to the crash, reaching a seven-month high near $1.70. But the fast move higher also attracted heavily leveraged traders, leaving XRP vulnerable to a sudden reversal.
When selling pressure arrived, those positions began to unwind rapidly.
Reports show that roughly $500 million in leveraged long positions were liquidated across the broader crypto market within minutes, while XRP suffered one of the sharpest reversals among major cryptocurrencies. The broader market recorded approximately $1.35 billion in liquidations over 24 hours.
XRP had been one of the strongest performers during the recent crypto market rally.
The token surged from around the $1 level to nearly $1.70 in less than a week, benefiting from the broader risk-on environment, Treasury buyback optimism and widespread short liquidations across the crypto market.
The rally was so strong that XRP still remained up roughly 47.5% over seven days even after the sharp pullback, according to market data reported on August 24.
However, the speed of the rally also created a crowded derivatives market.
As leveraged long positions continued to build, XRP became increasingly exposed to a liquidation cascade. Once the price started falling, exchanges began forcibly closing positions that no longer had sufficient collateral, adding further selling pressure.
The result was a rapid move from the $1.70 area back toward the $1.46 - $1.51 range, where XRP later attempted to stabilize.
Related: XRP on Track for Biggest Weekly Gain in 21 Months as Treasury Buyback Spurs Rally
The weekend crash appears to have acted as a major leverage reset.
Before the sell-off, XRP's derivatives market had become increasingly crowded after its rapid weekly rally. Following the liquidation event, open interest moved back toward the $3.7 billion range, showing that a significant amount of leveraged exposure had been flushed from the market.
This is important because a rally driven primarily by leveraged traders can become unstable. When prices move in the opposite direction, forced liquidations can amplify the decline far beyond what normal spot selling would produce.
The crash also came after signs of stretched momentum. XRP's RSI had reached heavily overbought territory during the rally, while the $1.70 area emerged as a major level where sellers quickly returned.
Related: Bitcoin Price Hits $80K as Short Liquidations Pass $220M: Can BTC Sustain the Rally?
Despite the sharp price volatility, institutional demand for XRP-linked funds remained relatively resilient.
Spot XRP ETFs reportedly recorded approximately $39.78 million in net inflows during the week, marking their strongest weekly performance since May and pushing cumulative inflows to around $1.55 billion.
This creates an interesting contrast for XRP.
The derivatives market experienced a sharp leverage-driven reset, while ETF flows continued to show demand from investors using regulated investment products.
That does not guarantee an immediate price recovery, but it suggests the weekend crash did not completely erase institutional interest.
Following the sharp pullback, XRP is attempting to stabilize around the $1.47 - $1.50 area.
On the upside, XRP needs to reclaim the $1.53 - $1.55 region before traders can start looking toward the broader resistance zone between $1.65 and $1.70. The $1.70 level remains particularly important after acting as the recent rally peak.
On the downside, the $1.35 - $1.40 range is emerging as an important support area. A failure to hold this region could signal that the market needs more time to recover from the liquidation event.
For now, XRP's dramatic weekend reversal serves as a reminder that strong rallies can quickly become unstable when leverage builds too aggressively. The token still retains a large portion of its recent weekly gains, but the next move will likely depend on whether spot demand can take over after the leveraged excess has been cleared.
Coinbase has launched tokenized US stocks on Base with Chainlink price feeds supporting Apple, Nvidia, Meta and Alphabet equities across onchain and DeFi applications.
Sei Network activity is accelerating as DEX volume jumps 316% in a day, while Mastercard and Dinari developments strengthen the blockchain’s push into institutional finance and tokenized stocks.
Tron Inc. now holds 711.2 million TRX worth roughly $245 million, making the company one of the more prominent public firms pursuing an altcoin focused crypto treasury strategy.
TRX
