XRP has experienced a significant price correction, dropping to $2.23 less than 48 hours after reaching $2.97 on March 2. The asset is currently trading at $2.44 after a brief recovery. However, this price is 16.26% down from yesterday and much lower than XRP enthusiasts predicted after Donald Trump announced the creation of a strategic cryptocurrency reserve . Vincent Van Code (@vincent_vancode), a crypto expert, highlighted this in a post on X. He believes this decline has little to do with XRP itself, saying it’s influenced by Bitcoin’s recent downturn. Current #XRP pullback has nothing to do with XRP and everything to do with #BTC taking a hit. The shock and realisation that BTC is not going to be front and centre as reserve asset, which leaves it's use little to no value. Nothing new same old story. Tokens still following… — Vincent Van Code (@vincent_vancode) March 3, 2025 He explained that the broader market decline is due to Bitcoin’s diminishing role as a reserve asset, which has led to reduced demand and subsequent price weakness. This shift in market sentiment has influenced altcoins, including XRP, as many tokens remain heavily correlated with Bitcoin due to exchange pairings and market-making strategies. We are on twitter, follow us to connect with us :- @TimesTabloid1 — TimesTabloid (@TimesTabloid1) July 15, 2023 The Role of Arbitrage and Exchange Mechanics A key factor in this market reaction is the way cryptocurrency exchanges operate. Many exchanges pair tokens with Bitcoin, leading to a scenario where price movements in BTC automatically influence other assets. Van Code suggested that exchanges primarily hold Bitcoin rather than a diverse range of tokens, as BTC offers better price stability and growth potential. “They only need to have enough of a specific token to cover withdrawals,” he noted, implying that exchanges manage their reserves by adjusting token prices based on Bitcoin’s value. This means that when Bitcoin declines, algorithmic trading strategies and market makers adjust the prices of other assets to ensure exchanges maintain enough Bitcoin reserves to meet withdrawal demands. The Influence of Trump’s Crypto Reserve Announcement Bitcoin’s decline comes in the wake of former U.S. President Donald Trump’s announcement on March 2 that the country’s crypto reserve would include XRP, Solana, and Cardano. This statement triggered a surge in XRP’s price, pushing it to levels not seen since it fell below $3 in early February . However, Bitcoin was not mentioned in Trump’s initial post, which may have contributed to its price drop. In a follow-up post, Trump later confirmed that Bitcoin and Ethereum would also be part of the reserve. However, the initial omission suggested a potential shift in government focus toward altcoins. This perceived lack of priority for Bitcoin may have further weakened confidence in its long-term role as a dominant reserve asset, contributing to the broader market downturn. Notably, the market crash in early February was caused by manipulation by market makers , and this shift toward altcoins may have triggered a similar reaction. Disclaimer : This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses. Follow us on X , Facebook , Telegram , and Google News The post Analyst Explains Reason For Recent XRP Pullback appeared first on Times Tabloid .
