XRP and XLM Prices Slide as ETF Outflows and Long Liquidations Shake Confidence
XRP and Stellar (XLM) prices fell sharply on Tuesday, with XRP dropping over 6% to $2.45 and XLM sliding 8% to $0.38, as a wave of ETF outflows and forced long liquidations rattled investor confidence in the crypto market.
The sell-off comes after data from CoinShares showed that digital asset investment products saw net outflows of $120 million in the past week, with XRP-focused products accounting for a significant portion. This marks a reversal from the prior weeks of inflows that had fueled a rally in the token.
Also read: ONDO Price Jumps 20% as Chainlink Integration Sparks Optimism
Liquidations Accelerate the Downturn
Data from Coinglass reveals that over $45 million in XRP long positions were liquidated in the last 24 hours, the highest level in two months. XLM saw an additional $12 million in long liquidations. These forced closures amplified the downward pressure, as traders who had bet on higher prices were caught off guard by the sudden move.
The liquidations were triggered after XRP failed to hold the $2.60 support level, a price point that had acted as a floor since early February. Once that level broke, stop-loss orders cascaded, accelerating the decline.
Also read: TRON Joins Institutional RWA Race With Hamilton Lane Credit Fund Tokenization
ETF Outflows Signal Shifting Sentiment
The outflows from XRP-linked exchange-traded products are notable because they follow a period of strong institutional interest. In January, XRP ETFs had recorded net inflows of nearly $200 million as investors anticipated a favorable resolution to the SEC’s case against Ripple. However, recent regulatory uncertainty and broader market jitters have prompted a pullback.
“The ETF outflows suggest that institutional investors are taking profits and reducing risk,” said James Butterfill, head of research at CoinShares, in a note. “The market is now pricing in a more cautious outlook for the second quarter.”
Bitcoin and Ethereum also saw modest outflows, but the impact was more pronounced on XRP and XLM, which have smaller market depths and are more sensitive to capital flows.
What the Sell-Off Means for Investors
The simultaneous decline in XRP and XLM is not surprising given their historical correlation. Both tokens are used for cross-border payments and often move in tandem. However, the current sell-off is notable for its speed and the role of leveraged positions.
For long-term holders, the drop may present a buying opportunity if the fundamental thesis for Ripple and Stellar remains intact. However, the near-term outlook is clouded by the risk of further liquidations and potential regulatory headwinds. The SEC’s ongoing appeal in the Ripple case continues to cast a shadow, and any negative development could trigger another leg down.
Traders should monitor the $2.30 support level for XRP and $0.35 for XLM. A break below those levels could signal a deeper correction toward the January lows.
