Ripple (XRP) shorts started to tumble soon as they reached the previous all time high. In fact, the 4H chart for XRPUSDShorts shows that the bears are so scared that the number of shorts had to drop double digits despite Bitcoin (BTC) and Ripple (XRP) both being trading in the red today. The situation that we see now is that Ripple (XRP) bears not only have to worry about a rising Bitcoin (BTC) but they also have to worry about an independent Ripple (XRP) that could perform a miracle during a market meltdown. So, shorting Ripple (XRP) is beginning to become less and less attractive for the bears. While shorts on coins like Ethereum Classic (ETC) are up significantly for today, Ripple (XRP) shorts are totally getting crushed even as the fate of Bitcoin (BTC) shorts remain uncertain.
The past few weeks have convinced the bears that shorting Ripple (XRP) is not as easy as it used to be. There was once a time when the bears could pull the price down even during most awaited yearly events for Ripple (XRP). During last year’s Ripple Swell Conference, the price of XRP kept on declining before, during and after Swell. Whenever Bitcoin (BTC) would drop, Ripple (XRP) would drop a lot more aggressively. So, the bears began to short it aggressively on exchanges like Bitmex and Bitfinex and it used to work until recently. However, ever since Ripple (XRP) overtook Ethereum (ETH) as the second largest coin by market cap, this situation has changed completely. Not only is shorting Ripple (XRP) less profitable now, it has become a lot riskier from a risk/reward standpoint.
There is now a high probability that XRP/USD might stand its ground during a future Bitcoin (BTC) crash. Besides, Ripple (XRP) is already positioning itself as a direct Bitcoin (BTC) competitor. It would not be surprising if Ripple (XRP) were to escape the influence of Bitcoin (BTC) completely. There have been talks of decoupling in the past and considering that Ripple (XRP) has very little in common with most cryptocurrencies, this would be very likely to happen. Certainly, if it were to exceed the market cap of Bitcoin (BTC) than I don’t think we would see it on a lot of places, for instance Coinmarketcap. They have already made it clear where they stand with Ripple (XRP). Just last year, they deliberately misrepresented the price of Ripple (XRP) by excluding Korean trading volume. That showed up as a big loss for Ripple (XRP) on Coinmarketcap which triggered significant sell off.
Later on, it became clear that this had happened just because Coinmarketcap had excluded Korean Trading Volume from the equation but by then the damage was done. We have not seen Ripple (XRP) get listed on Coinbase despite frequent community appeals and requests. The interest is there, people want to see it on Coinbase, but Coinbase does not want to list it. The point is, many stakeholders in this industry do not consider Ripple (XRP) as part of the family. So it would not be unlikely for it to decouple from Bitcoin (BTC) at some point which explains why the bears are not comfortable shorting Ripple (XRP) anymore.
Source: Crypto Daily