XRP Longs Wiped Out: Binance Leads $5M Liquidation Wave

Summary:
XRP is making an effort to recover the $2 price level after a sharp decline that briefly dropped its value to $1.85. Despite the bulls trying to stabilize the situation, the overall market is facing challenges due to increasing macroeconomic uncertainty. A recent report shows that January 18 saw significant forced liquidations of XRP long positions, primarily driven by Binance, contributing to over $5 million in liquidations that day. Traders find themselves caught in a volatile market landscape as macroeconomic factors continue to influence price movements.

Key Takeaways

XRP is attempting to bounce back from a low of $1.85, but remains under pressure below $2.
January 18 marked a significant day for XRP's forced liquidations, totaling over $5 million.
Binance was the leading exchange, contributing approximately $1.05 million to those liquidations.
Macro factors, particularly geopolitical issues, have triggered broader sell-offs within the cryptocurrency market.
The market structure shows XRP struggling to break past critical resistance levels, with a focus on reclaiming $2.10–$2.20 for bulls.

XRP Longs Wiped Out: Binance Leads $5M Liquidation Wave

XRP's Recovery Efforts

XRP is working to regain the $2 mark following a sharp decline that pushed prices down to around $1.85. As traders try to stabilize the coin's value, macroeconomic uncertainties loom over the cryptocurrency market, with analysts suggesting a potential deepening of the bear market. This volatile environment is exacerbated by leverage, turning XRP's derivatives market into a fierce battleground.

A recent report by CryptoQuant highlights January 18 as one of the most challenging days for leveraged XRP traders this month. Data from the XRP Exchange Liquidation Metrics reveals a significant wave of forced liquidations impacting long positions across major exchanges. This indicates many traders over-leveraged themselves during the downward trend. Unlike trading volume or open interest, liquidation data showcases positions being closed involuntarily, meaning traders were eliminated rather than making an active choice to exit.

XRP Exchange Liquidation Metrics | Source: CryptoQuant

Total long liquidations on that day surpassed $5 million, marking a notable liquidation event for January. Binance played a substantial role in this flush, responsible for roughly $1.05 million in long liquidations. This reinforces its status as a key player in XRP’s short-term market movements.

Macro Factors Fuel XRP’s Liquidation Wave

The CryptoQuant report indicates that the liquidation spike for XRP on January 18 was influenced not only by technical factors but also by broader macroeconomic conditions that affected the entire cryptocurrency market simultaneously. This was not a gradual decline; instead, it appeared as a coordinated shock where traders across various assets had to pull back their investments amid rising uncertainty in global markets.

According to the report, the catalyst for this market shift stemmed from geopolitical tensions and trade-war rhetoric. The Financial Times reported that European countries might respond to U.S. pressures about Greenland, considering tariffs of up to €93 billion ($107.7 billion), or possibly restricting U.S. companies' access to the EU. Even though no immediate actions have been taken, this headline reignited fears of escalating tensions across the Atlantic.

Markets typically perceive such events as liquidity threats. When tariffs and retaliatory measures enter discussions, traders factor in expectations of slower growth, heightened financial constraints, and increased volatility. Given that cryptocurrency typically responds as a high-risk asset, it tends to react swiftly to such news.

The drop in Bitcoin’s price from above $95,000 to below $93,000 also exacerbated the situation, reinforcing negative momentum across altcoins. In the case of XRP, this pressure transformed into forced selling, leading to liquidations of leveraged longs in a declining market.

XRP Faces Challenges Below $2 After a Sharp Rejection

XRP is working to stabilize following a sharp downturn that pulled the price back into the $1.85–$2.00 range. The daily chart illustrates a clear rejection from a recent rebound high around $2.40, accompanied by a strong sell-off that erased most of the gains made. XRP is currently trading at approximately $1.97, lingering just below the crucial psychological $2 level, which has become a short-term pivotal point for momentum.

XRP consolidates around key price level | Source: XRPUSDT chart on TradingView

From a market perspective, the trend remains under pressure. The price continues to fall below key moving averages, with the quicker average acting as dynamic resistance. The mid-term trend is also trending downward, reinforcing the view that price rallies are still being sold rather than sustained. This aligns with a continuing pattern of lower highs since the peak in October, suggesting the market is undergoing a corrective phase.

The wick structure and recurring failed attempts to breach the $2.20–$2.40 range indicate aggressive sellers defending that supply zone. Simultaneously, buyers are stepping in near the $1.85 mark, forming a noticeable demand floor that has held during recent volatile conditions.

For bullish traders, reclaiming the $2.10–$2.20 range is crucial for a pathway to recovery. If this does not occur, the risk of another downturn towards the $1.85 level remains a genuine concern.