Ethereum, XRP slide amid broader market correction ‘without clear catalyst,’ analysts say

The crypto market experienced a sell-off on Wednesday, with major altcoins declining and reversing gains from the past few days.

Ethereum fell 4% in the past 24 hours to trade at $3,565 at the time of writing, while XRP plunged 12.7% to $3.05, according to The Block's price page. BNB fell 5.3% and SOL lost 9.5%.

Bitcoin dipped 0.6% to $117,868, holding relatively steady despite the sharp decline in altcoins.

Min Jung, research analyst of Presto Research, told The Block that the market correction appears to be happening "without a clear catalyst."

"This seems more like a breather or profit-taking event, especially considering that Ethereum is still up 7% and Dogecoin 12% over the past week, even after today's pullback," said Jung.

Nassar Al Achkar, chief strategy officer of CoinW, shared similar views. "The sharp pullback of crypto prices reflects temporary profit-taking after recent rallies, which have been compounded by leveraged liquidations and rotation out of altcoins ahead of key ETF decisions," he said.

Liquidations

Meanwhile, Vincent Liu, CIO of Kronos Research, suggested that crypto is down on "cascading liquidations and thinning liquidity," as over-leveraged longs got flushed across fragile altcoins.

According to Coinglass data, the overall crypto market saw $837 million in total liquidations over the past 24 hours. Ethereum accounted for $168 million, including $142.4 million in long positions. XRP long positions saw $92.7 million liquidated. 

Bitcoin, on the other hand, reported $73.5 million in total liquidations, including $57.4 million from long positions.

Crypto liquidations occur when a trader's positions in the crypto market are forcibly closed due to significant losses or a lack of sufficient margin to meet the maintenance requirements. The reported liquidation figures are based on publicly available data and may significantly understate the true scale of market liquidations. API limitations and incomplete reporting often mean that data aggregators capture only a portion of actual activity.

While altcoins face pressure from "fading retail interest," traders are closely monitoring geopolitical tensions, institutional exchange-traded fund inflows, and technical support levels, said Nick Ruck, director of LVRG Research.

Jung of Presto also said that the broader macro theme remains intact. "Crypto continues to see strong demand from corporate treasury buyers. Traders are closely watching upcoming earnings from major tech firms and any signals from macro data," he said.