In December 2025, market expert Vincent Scott and other analysts have labeled this the "worst time" for XRP holders due to a specific phenomenon called "Liquidity Extraction." Here is the short explanation of what is happening:
1. Institutional Strategy: "The Squeeze"
While retail investors are waiting for "moon" prices (targets like $10 or $100), major investment firms are reportedly doing the opposite:
* Extracting Liquidity: Firms are drawing liquidity out of the market to cover year-end losses or reallocate to more stable assets like Bitcoin.
* Suppressing Price Discovery: By selling into retail "buy" orders and using advanced hedging (shorting), institutions are keeping XRP trapped in a tight range between $1.85 and $2.00.
* Leveraging Anxiety: Scott argues that "influencers" and firms are weaponizing investor anxiety to keep retail holders from selling, allowing institutions to exit their positions at better prices.
2. The "Worst Time" for Retail
The current frustration stems from a speculative overshoot at the end of 2024.
* Underwater Holders: Approximately 48% of XRP holders are currently "underwater" (holding at a loss), leading to extreme fatigue.
* Failed Catalysts: Even after the SEC case officially ended in August 2025 and Spot XRP ETFs launched, the price has failed to sustain a rally, leading many to believe the "big news" was already priced in.
3. Critical Levels to Watch
* The Support: If XRP falls below $1.80, experts warn of a "flash crash" toward $1.62 or even $1.25.
* The Resistance: A decisive move above $2.00 is required to break the current institutional "sell the rally" cycle.
The Bottom Line: Investment firms are currently treating XRP as a liquidity tool rather than a long-term hold, leaving retail investors caught in a "sideways trap."
Would you like me to look into the specific XRP ETF inflow data to see if institutional buying is starting to offset this sell pressure?
