The retail market sentiment for Bitcoin and Ethereum has gone deeply bearish, while traders have an optimistic view about XRP. However, the market moves in the opposite direction of the retailer’s perspective, so there could be a recovery. This sell-off is not just one factor, but it is a combination of many factors, like tighter liquidity and a strengthening greenback, says analyst.
Fear grapples markets
The overall sentiment of the crypto market is very bearish on Bitcoin and Ethereum, the top two coins by market cap, which set the overall tone. The Fear and Greed Index indicator, which gauges the sentiment of the traders based on a few parameters, has sunk deep into extreme fear. This is a period where traders exercise precaution and stay on the sidelines until the threat is gone.
Amidst these harsh and unforgiving conditions, the crypto social activity tool, Santiment, stated, “there remains a strong argument for a short-term relief rally as long as the small trader crowd continues to show disbelief toward cryptocurrency as a whole.”
The market slump is a mix of many factors
This sell-off isn’t coming from one single trigger. It’s a mix of tighter liquidity expectations, a stronger dollar, and a broader risk-off mood that’s hitting equities, metals, and crypto at the same time.
Analyst Lavneet Bansal
He stated that in crypto, that pressure is amplified by leverage unwinding and short-term traders stepping back, which is why sentiment has turned sharply bearish. When fear becomes this one-sided, it often says more about positioning and confidence breaking than about any new fundamental shift.
“What matters next is whether selling pressure fades, not whether sentiment flips overnight.” stated Bansal.
However, the crowd in particular is very optimistic about XRP, much more than Bitcoin and Ethereum.
Bitcoin looks miserable on charts after it kept on losing consecutive support levels. Priced at $70.5K, the flagship coin is still reaching for neutral ground to floor the fall. Unlike BTC, which is tumbling, the Ethereum weekly chart still holds its bullish momentum intact.
Despite the surrounding turmoil, ETH is sticking to an uptrend, making higher lows. Now that the coin has landed on the trendline, it is time for a rebound.
The Relative Strength Index (RSI) indicator confirms that ETH will rebound, as the RSI is very close to being oversold. Usually when a coin is oversold, it triggers the traders to buy the coin, and this could lead to a buying frenzy.
Retailers fancy XRP as institutions show interest
If Ethereum is still holding its bullish shape intact, then why is the market considering it bearish while being optimistic about XRP? It is sometimes not just prices that fascinate the community, but how it could be adopted into real use cases.
Talking about real use cases, the XRP ledger has been of great institutional interest. It’s not just private entities that are after XRP but even public corporations like the Riyad Bank.
Just a week ago, Saudi Arabia’s popular bank, Riyad Bank, partnered with Ripple to explore possibilities of using blockchain to develop fast, secure, and transparent financial service across the kingdom.
When Riyad Bank was interested in Ripple’s infrastructure, the Bank of America showed its interest in the XRP ETPs. The Bank of America currently holds around 13,000 shares of the Volatility Shares XRP ETF, which is worth about $224,640.
Although the amount is quite meager compared to the bank’s portfolio, this is a good indication of the institutional demand for XRP ETP. So, when institutional investors go after something, it means there is real value and use cases; smart money and retailers follow the trend.
