- Jake Claver warns XRP investors: liquidity shortages could cause major losses.
- Ripple’s GTreasury deal may reduce market liquidity during XRP rallies.
- Experts urge holders to plan ahead before XRP prices skyrocket.
The XRP community was thrown into discussion after a detailed update from Diana on X highlighted a crucial warning from Jake Claver, CEO of Digital Ascension Group. According to Claver, many XRP investors risk losing thousands of dollars if they fail to plan for liquidity problems during the next major market surge.
Claver cautioned that when XRP experiences a massive surge, most traders rush to sell at the same time. However, the market may not have enough buyers ready to purchase those tokens at high prices.
This situation, known as thin liquidity, can cause significant slippage. Investors expecting to sell at ten dollars might see their orders filled much lower, around eight dollars and fifty cents, resulting in sudden losses.
He compared this market rush to people trying to exit through a small door during an emergency. Everyone tries to move out at once, but the limited space causes a bottleneck. That is exactly what happens in crypto markets during parabolic rallies when traders compete to cash out simultaneously.
Also Read: Pundit: ‘Institutions are Fighting Over XRP, Not Enough to Go Round’
Institutional Moves May Intensify Liquidity Challenges
Claver highlighted that large institutions do not usually trade on public exchanges like retail investors do. Instead, they engage in private over-the-counter transactions. This trend means a substantial amount of XRP liquidity remains outside public markets, reducing the available volume for everyday traders.
Adding to this, Ripple’s one-billion-dollar acquisition of GTreasury will likely push even more XRP liquidity into corporate payment systems. While this enhances real-world use, it could also mean fewer tokens remain available on public exchanges when investors try to sell during a bull market.
Claver urged XRP holders to plan ahead before the next major rally. He advised them to move their assets off exchanges, set clear sell targets, and rely on limit orders instead of market orders. These steps can help traders protect profits and minimize the risks caused by rapid market movements.
The insight shared by Diana serves as a crucial reminder for XRP holders to plan ahead. As XRP adoption grows among financial institutions, traders who understand liquidity patterns will be better positioned to navigate price surges without losing thousands in the process.
Also Read: Bitcoin and Altcoins Record Strong 24-Hour Gains as Crypto Market Strengthens
