Ethereum News Today: Ethereum and XRP Drop 4 and 12.7 as Crypto Market Slumps on Profit-Taking, Liquidations

The cryptocurrency market witnessed a sharp correction in altcoins on Wednesday, with major tokens like Ethereum (ETH) and XRP plummeting amid a lack of clear external catalysts. Analysts attributed the decline to profit-taking, leveraged position liquidations, and declining liquidity in derivatives markets. Ethereum fell 4% to $3,565, while XRP dropped 12.7% to $3.05, contrasting with Bitcoin’s relatively stable 0.6% decline to $117,868. The broader market capitalization fell 2.7% to $3.82 trillion, reflecting widespread pressure on alternative cryptocurrencies [1].

The correction was exacerbated by cascading liquidations, with $837 million in forced closures across the crypto market in 24 hours. Ethereum and XRP accounted for $168 million and $92.7 million of liquidations, respectively, as traders with overleveraged positions faced margin calls. Analysts highlighted that these figures likely underrepresent actual volumes due to API limitations and incomplete reporting [2]. CoinW’s Nassar Al Achkar noted the decline was a “temporary profit-taking move” compounded by leveraged position unwinding ahead of potential ETF decisions, while Vincent Liu of Kronos Research pointed to poor liquidity as a systemic risk, with fragile altcoins bearing the brunt of liquidations [3].

Ethereum’s price action underscored the volatility, with the token testing critical support near $2,800 as over 640,000 ETH tokens prepared to exit staking pools. Analysts suggested this could signal profit-taking by institutional stakers, potentially increasing downward pressure if the tokens are sold [4]. Dogecoin similarly retreated 8.6%, testing levels that may determine its short-term trajectory. While some experts, like Presto Research’s Min Jung, remain optimistic about the long-term outlook—citing robust corporate treasury purchases and macroeconomic focus—others warned of a liquidity vacuum caused by overleveraged positions unwinding [5].

The selloff erased $700 million in market value within 24 hours, driven by a “long squeeze” dynamic where forced exits triggered further selling. This behavior contrasted with traditional markets, where Bitcoin typically gains during equity sell-offs. However, Bitcoin’s dominance rose slightly, with analysts noting that increased funding rates on derivatives platforms like Solana and Cardano hinted at renewed speculative interest, albeit secondary to the broader risk-off trend [6].

Market participants remain divided on whether the correction signals a larger trend shift. Technical analyses suggest Ethereum could rebound to $6,000 if support at $2,800 holds, but immediate caution persists. The unwinding of leveraged positions, validator exits, and macroeconomic risks—including U.S. interest rate concerns—add layers of uncertainty. As the market awaits stabilization, attention will focus on whether altcoins can hold key levels or face deeper corrections [7].

Source: [1] [Why Is Crypto Going Down? XRP, Dogecoin, Ethereum...](https://www.financemagnates.com/trending/why-is-crypto-going-down-xrp-dogecoin-ethereum-and-bitcoin-prices-are-falling-today/)

[2] [Why is the Crypto Market Going Down Today?](https://coinpedia.org/news/why-is-the-crypto-market-going-down-today-2/)

[3] [Ethereum Price Targets $2800 as 640000 ETH Exits Staking](https://coingape.com/markets/ethereum-price-drop-to-2800-as-640000-eth-exits-staking/)

[4] [Dogecoin Retests Crucial Support Following 8.6% Daily Drop](https://www.newsbtc.com/news/dogecoin-retests-crucial-support-following-8-6-drop-here-are-the-levels-to-watch/)

[5] [Crypto Market Nosedive](https://www.actionforex.com/contributors/fundamental-analysis/605567-crypto-market-nosedive/)

[6] [DevvStream Shifts Focus to BTC and SOL Treasury](https://m.economictimes.com/crypto-news-today-live-22-jul-2025/liveblog/122821149.cms)

[7] [Crypto Crash Wipes Out $700M as ETH and XRP Lead...](https://coinpedia.org/news/crypto-crash-wipes-out-700m-as-eth-and-xrp-lead-long-squeeze-liquidations/)