XRP's 9% Drop on November 6: Who Sold and Who Was Buying

Blood bath. That's the word all over crypto this week. XRP dropped about 9% in a single day. Bitcoin fell below the $75,000 mark for the first time since August. And one report says around $8 billion of XRP's market value disappeared in 24 hours.

Now, Open YouTube video after video is telling you why it's crashing. tech stocks, the midterms, fear of new rules, and some of the biggest XRP voices are now saying out loud that they're selling. But here's the question almost nobody is answering. If everyone is selling, who is actually selling? And who is on the other side buying? Because every single time a coin is sold, somebody buys it.

And the answer to that question tells you a lot more than what the price does. So today, we're going to do what reporters do. We're going to look at what actually happened this week with the numbers. We're going to break down the three groups doing the selling. We're going to look at the clues about who's been buying.

And then I'll show you the one mistake that cost XRP holders the most in weeks like this. And the simple plan that protects you whatever the market does next. This is education and commentary, not financial advice. Nobody knows where the price goes from here, and I'm not going to pretend that I do. If you're feeling bullish, hit that like button and smash that subscribe button.

We're on our way to 400,000 subscribers, so we can only do that with you. And buckle your seat belts. Let's start with what happened. According to the reports, it started with a sharp sell-off in the US tech stocks on Thursday. Big tech names that had be carrying the stock market got hit real hard.

Trillions of dollars in market value were wiped off stocks around the world and crypto followed. Bitcoin had been climbing after the midterm elections. That rally reversed. By last Friday, Bitcoin was trading around $75,000, the lowest level in months. And XRP fell harder than most.

It dipped below $1.20, down roughly 8 to 9% in a day according to the market reports. And different reports blame different things. Some say it was the tech stocks. Some say it was the midterm elections because Democrats won. And some traders fear that stricter crypto rules are coming.

Some say that XRP just broke down on the charts via technical analysis. And the honest answer is it was probably a mixture of all of that. Markets don't usually fall for just one simple reason. But why isn't the most useful question. The most useful question is who.

So let's go through the sellers. Seller number one, the people who didn't choose to sell, leverage traders. Here's how this works. On a lot of exchanges, you can borrow money and make it a bigger bet. You can put in $1,000 and trade it like you had $10,000.

That's 10x leverage. It feels great when the price goes up or in your direction, but when the price goes down far enough, the exchange doesn't ask you. It literally sells your position for you automatically to cover the loan. And that's called the liquidation. And according to reports, more than $1 billion of leverage positions were liquidated across crypto during the sell-off.

Here's the part that most people miss. Those forced sells push the price down even further, which triggers the next round of liquidation, which pushes the price down again. It's a chain reaction. Sometimes it's called a falling knife. And one more thing about leverage on many exchanges, the liquidation doesn't happen at a price that you choose.

It happens at whatever price the market gives in that second in a fast crash that can be well below where you thought you'd actually get out. Here's how one investor explained it on CNBC during a past crash.

We are accumulating this huge reserve of Bitcoin. I believe they uh terror folks made claims of maybe up to 10 billion worth of Bitcoin and then just a few short weeks later uh they're apparently liquidating Bitcoin to support the PEG. Uh so all they ended up doing was just adding a massive amount of cyclicality uh and reflexivity to the price of Bitcoin.

And what's really interesting is if we go back one calendar year almost to that October moment when all the cryptos got extremely flash crash liquidation to the downside. If you've been in crypto long enough, you know what I'm talking about. This past weekend wasn't even as extreme as that, but it was very bad. So, a big piece of the selling this past week wasn't people deciding XRP was finished. It was machines closing out bets that got too big.

And that's important because forced selling says a lot about leverage and a very little about what long-term holders think. Seller number two, funds. Reports say that there were renewed withdrawals from US spot crypto ETFs this week. When people pull money out of an ETF, the fund may have to sell some of what it's holding. that adds selling pressure usually at high volumes. Now, ETF money is a mix.

Some of it in long-term money and some of it is fast money that moves with the stock market and when the tech stocks get hit, a lot of that fast money gets pulled from everything risky at once, crypto included. Trackers like Farside publish them every day. Seller number three, frustrated holders. This is the one getting the most attention. One report this week said a growing number of frustrated XRP holders are signaling that they want to sell.

And yes, some well-known crypto YouTubers have said that they're selling some of their coins, too. And I'm not going to tell you they're wrong. People sell for all sorts of reasons. Taxes, a house, a plan that they made a long time ago, or just being tired of waiting. And that's their call.

But here's what's worth noticing. When the loudest voices start saying they're selling, that tells you about the mood. It doesn't tell you about the future. Mood and price can go in opposite directions and they often do. So those are the sellers, forced sellers, fund outflows, tired holders.

But let's flip it around. Who's buying? Because remember, for every coin sold, someone bought it. And here's the first clue. According to onchain data from Cryptocoin, as reported earlier this week, the amount of XRP sitting on Binance, one of the world's biggest exchanges, dropped to its lowest level in about 5 years.

That means a lot of XRP has been moving off the exchanges. Now, I want to be careful here. Coins leaving an exchange can mean different things. It can mean people are moving XRP into their own cold storage wallets to hold it. It can mean that big funds are moving coins to a custodian. or it can just be the exchange moving coins between its own wallets.

Analysts often read falling exchange reserves as a sign that people are holding rather than getting ready to sell. But it's a clue, not proof. And here's the second clue. Some reports this week described traders calling XRP oversold and watching for buyers to step in. That's not a prediction from me.

It's just telling you that the other side of the trade exists and it's paying attention. And here's the third clue, and it's the oldest one in the book. The people who have been through the most market cycles tend to behave the opposite way to everyone else in weeks like this. Here's Warren Buffett talking about what falling prices mean to him.

Anytime stocks go down, as far as I'm concerned, I like it because I'm a net buyer of stocks. I've been buying stocks ever since I was 11 years old. So, when stocks go down, it's good news. Just like when hamburgers go down, it's good news. Or Coca-Cola goes down, it's good news in terms of anything I buy.

Now, Buffett is talking about businesses he studied for decades. That's not a tip to buy anything. The point is the mindset. Every long-term investors decide what they're going to do before the crash, not during it. And here is something worth thinking about.

Look at what else happened in the same two weeks that XRP fell. On October 28th, DTCC, the company that settles almost every stock trade in America, switched on its tokenization service. On November 3rd, Morgan Stanley said it had already used it to put stocks and treasuries on a blockchain. Now, to be fair, the XRP ledger isn't one of the networks the DTCC picked. We covered that in a separate video a while ago.

But the bigger story, Wall Street moving onto blockchains kept moving forward. While the price went one way, the building went the other. That happens a lot. Prices react to fear and leverage in a matter of hours. Adoption moves over months, if not years.

If you only watch the price, a week like this feels like the end of the world. If you watch what's being built, it looks like a lot more noise. That's not a reason to ignore the price. It's a reason to know which one you're actually investing in. And that brings me to the mistake, the one that costs XRP holders the most in weeks like this.

It's not buying at the wrong time, and it's not selling at the wrong time. It's having no plan and then letting the week decide for you. Here's what that looks like. price goes up and then you feel smart so you add more maybe with leverage 10x as we talked about earlier and then price goes down 9% in a day and then you open YouTube and every video says it's a blood bath now you're scared so you sell not because your reason for owning XRP changed but because your feelings did and then a few weeks later you're watching from the sidelines wondering what happened that cycle has nothing to do with XRP it happens with every asset in every market to people without a plan and this isn't the first time we've seen this so Let me take you back. March 2020, the world shut down for COVID. Stocks crashed.

Bitcoin lost roughly half of its value in about 2 days. A huge part of that drop was leverage being wiped out. Then May 2021, another crash. And reports at the time put liquidations at around $8 billion in a single day. November 2022, FTX collapsed and people who left coins on that exchange lost access to them.

Three different crashes, three different reasons, but look at who got hurt the most each time. people using borrowed money and people who sold in a panic at the bottom and people who trusted an exchange with everything. Past results don't tell you what happens next. But the mistakes repeat and so do the lessons. So let's look at both sides of where this could go because it's fair to hear both. The bears say this tech stocks are falling and crypto tends to follow them down.

Democrats winning could mean slower progress on the crypto rules and some big holders are clearly heading for the exits. The bulls say this. Much of the selling was forced from leverage, not from long-term holders changing their minds. XRP on exchanges is near a five-year low. And the things Ripple is building from payments to stable coins to tokenization didn't change this week.

Only the price did. Both sides agree on one thing. Weeks like this are when people make decisions that they regret the most. You decide which you're on. But here's what you can actually watch.

Number one, leverage. Watch the liquidation numbers. When the force selling dries up, a big source of pressure goes away. Number two, ETF flows. If the outflows turn back into inflows, the funds have stopped selling.

Number three, exchange reserves. If XRP starts flooding back onto exchanges, that can be a sign that more people are getting ready to sell. If it keeps leaving, people are holding. Number four, the stock market. This week, crypto moved with tech stocks.

If tech steadies, the pressure eases, too. So, what's the plan? Well, here are three rules that people who have been through a cycle or two, they live by. Rule number one, no leverage on money you can't afford to lose. Every one of those billion dollars in liquidations was somebody's plan that a machine closed out.

If you own XRP outright, a drop is painful. If you own it with borrowed money, a drop can end the game. Rule two, decide your numbers before the market does. Write down how much your money that is in crypto. Write down what you would do if it fell another 20% and what you would do if it doubled.

Do it on a calm day, not on a red one. Then when a week like this comes, you're following your plan, not your feelings. And here's a simple example. Say crypto is 20% of everything you own. You decide on a calm day that you're comfortable with that.

And if a crash takes it down to 15%, you already know whether you'd add, hold, or do nothing. If a rally takes it up to 40%, you already know whether you take some off the table. No guessing, no panic, just following the numbers that you set when you were thinking clearly. That's what a plan is. And then rule number three, check where your coins are.

If your XRP sits on an exchange, you're trusting that exchange through every crash. Many long-term holders keep most of their coins in a wallet that they control and only keep what they tend to trade on the exchange. Whatever you choose, make it a choice, not an accident. And this is exactly the kind of thing we help our clients with. If you want a second set of eyes on your crypto, we're giving away a free portfolio review.

Someone on my team will look at what you hold and then they'll help you build a plan that works in a week like this one and in a good week as well. So, you're not just relying on Ripple or on YouTube to tell you what you can do. Click the first link down in the description, watch the free briefing, and then book a free portfolio review. It is free and there is no catch. So, let's wrap it up.

This week, a tech sell-off spilled into crypto. Bitcoin fell to around $75,000 and XRP dropped below$120. A big part of the selling was forced from leverage traders getting liquidated. Some came from the ETF outflows and then some came from tired holders, including some well-known voices. And if you've watched X lately, people are really upset with XRP specifically.

On the other side, XRP on Binance fell to around a 5-year low, which analysts often read as people holding, not selling. And nobody knows what next week brings. But the people who come out of weeks like this in good shape usually have one thing in common. They had a plan before it started. So keep the leverage away from money you need.

Decide your numbers on a calm day and know where your coins are. You decide what to do next. Just make sure it's your decision and not the markets. If this helps you at all, like this video and subscribe. We're on our way to 400,000.

Also, share it with one person who is panicking this week. Let them see this information. And as always, stay bullish.