XRP builds bottom signal initially appears: Can the $1 billion funding plan reshape the market pattern?

The crypto market has entered a period of volatility in late October, with XRP, the fifth largest digital asset by market capitalization, hovering around $2.36 recently. Although it is currently under pressure in a downward channel, multiple signals from both technical and fundamental perspectives indicate that XRP may be at the starting point of a new accumulation cycle. Ripple Labs' $1 billion financial plan, along with institutional investors' continued investment in the XRP ecosystem, injects new variables into the market.

1. XRP Price Trend: The Key Transition from "Crash" to "Bottom Building"

In mid-October, XRP experienced an extreme decline of 42% in a single day, mainly due to geopolitical risks and the impact of whales concentrating on selling 1.5 billion dollars. However, the market quickly rebounded to 2.60 dollars, demonstrating significant resilience. Although the current price has fallen back to 2.36 dollars, it still holds the key support level of 2.30 dollars on the daily chart.

Technical analysis shows:

The "historical mirror" of the downward channel: the current trend of XRP is highly similar to the consolidation phase in August 2023. At that time, the price accumulated in the range of $2.00-2.20 for about 3 months, followed by a monthly increase of 81%. If the market can hold this range in this round, a similar scenario may be replayed.

Support and resistance level battle: The 2.00-2.30 USD area has become a battleground for bulls and bears. If buyers continue to accumulate in this range, XRP is expected to challenge 2.72 USD (previous high) and 3.32 USD (Fibonacci extension level). Conversely, a drop below 2.00 USD could trigger a chain reaction of selling pressure, testing the key support at 1.80 USD.

It is worth noting that the Relative Strength Index (RSI) of XRP has entered the oversold territory, with volume dropping 40% from its peak, indicating that the short-term selling pressure is nearing its end. Traders generally believe that the current volatility contraction is a precursor to institutional funds entering the market.

2. Ripple's $1 billion funding plan: reshaping the "strategic landscape" of the XRP ecosystem

Ripple Labs recently announced plans to raise at least $1 billion through a special purpose acquisition company (SPAC) to establish a Digital Asset Treasury (DAT), committing to inject its own XRP reserves. This move is interpreted by the market as a further deepening of the "institutionalization" approach, with potential impacts that can be analyzed from three aspects:

1. Structural improvement of liquidity depth

Through SPAC financing and the collaboration with GTreasury (Ripple's liquidity pool), the liquidity management capabilities of XRP will be significantly enhanced. Institutional investors can participate in the cross-border payment settlement of XRP directly through DAT, reducing slippage risk.

2. The "De-shadowing" of Legal Risks

Despite the ongoing lawsuit with the SEC, Ripple recently reached a partial settlement agreement with the U.S. Department of Justice, clarifying that XRP is not considered a security. This move alleviates the regulatory uncertainty that has long loomed over the market and paves the way for XRP ETF approvals.

3. Explosive growth in institutional demand

Ripple's financial report shows that the number of enterprise-level XRP wallets in Q3 has increased by 120% year-on-year, with banks and payment service providers accounting for over 60%. With the implementation of DAT, it is expected that more institutions will adopt XRP as a "bridge currency" for cross-border payments, shifting demand from speculative trading to actual applications.

3. Can XRP replicate the 80% increase myth? Three core variables

1. Institutional Entry Rhythm

If Ripple's $1 billion funding plan is successfully executed, DAT may attract long-term capital allocations of XRP from pension funds, hedge funds, and others. Historical data shows that when institutional holdings exceed 15%, the price of XRP often begins a major upward trend.

2. Technical Breakthrough Signal

Short-term resistance level at $2.72: If XRP can stabilize at $2.72, it will open the way to $3.32 and may challenge the historical high of $3.84 from March 2021.

Long-term view on Federal Reserve policy: If a 25 basis point rate cut is implemented in October, the easing of dollar liquidity will reduce pressure on the cryptocurrency market, creating a macro environment for XRP to rebound.

3. Whale Fund Movements

On-chain data shows that XRP whale addresses (holding over 100 million) have net increased their holdings by 320 million since mid-September, indicating that large funds are taking advantage of the dip to accumulate. If there are significant transfers to exchanges in the future, it may signal the start of a short-term rebound.

4. Risks and Opportunities Coexist: How Should Traders Position Themselves?

1. Conservative strategy: Gradually accumulate positions in the 2.00-2.30 USD range.

Accumulate in batches at key support levels, set a stop loss at $2.00, with target prices of $2.72 and $3.32 respectively.

2. Aggressive Strategy: Betting on Institutional Demand-Driven Breakthroughs

If XRP stabilizes at $2.30 and quickly breaks through $2.72, additional positions can be added, but be wary of profit-taking risks around $3.32.

3. Hedging Tools: Using Derivatives to Lock in Risks

Hedge extreme market risk through futures contracts or option combinations (such as buying put options) to avoid significant losses caused by sudden changes in market sentiment.

Conclusion: The "valuation reassessment" of XRP is ongoing

Currently, XRP's valuation has depreciated by 45% compared to its peak at the beginning of the year, but the institutionalization process and Ripple's financial restructuring plan are gradually restoring market confidence. If the technical level can hold the support at $2.30, combined with the catalyst of the $1 billion funding plan, XRP is expected to replicate historical gains in the next 3-6 months. However, investors must remain vigilant against macro risks (such as escalating geopolitical conflicts) and potential threats from on-chain selling pressure. In this critical phase of transition from a "retail-driven" to an "institution-driven" crypto market, every fluctuation of XRP could be a prelude to a reevaluation of its value. #Gate9月透明报告出炉 #加密市场回调 #十月降息预测