XRP Investors Become Fearful: Time To Buy?
January 16 2024 - 10:00AM
NEWSBTC
Data shows the sentiment around XRP has taken a plunge following
the failed attempt at a Bitfinex attack using the “partial payments
exploit.” XRP Weighted Sentiment Has Plunged To Negative Levels
Recently As explained by the on-chain analytics firm Santiment in a
new post on X, the sentiment around XRP has turned negative. The
indicator of interest here is the “Weighted Sentiment,” which
itself is based on two other metrics: the “Sentiment Balance” and
“Social Volume.” Related Reading: Dogecoin To See 24% Rally To
$0.100 If This Holds: Analyst The former of these basically keeps
track of the sentiment currently present among social media users
around any topic. The indicator calculates this score by going
through social media posts and using a machine-learning model to
separate between negative and positive sentiments. The other
relevant metric here, the Social Volume, measures the amount of
discussion related to any given topic that’s happening on the major
social media platforms right now. The indicator measures this by
counting the total number of unique posts or threads making at
least one mention of the topic. Now, what the “Weighted Sentiment”
does is that it takes the Sentiment Balance and weighs it against
the Social Volume. What this means is that the Weighted Sentiment’s
value would only register a spike when not only is the sentiment
leaning towards one side, but the sample size of these posts is
also large. The below chart shows the trend in this indicator for
XRP over the last few months: Looks like the value of the metric
has taken a plunge in recent days | Source: Santiment on X When the
Weighted Sentiment has a highly positive value, it means that there
is a high amount of positive discussion happening related to the
asset. From the graph, it’s visible that XRP saw such a bullish
sentiment earlier in the month when its price made a recovery
attempt. Since then, however, the indicator’s value has plummeted
for the cryptocurrency and is now floating deep inside the negative
zone. Naturally, this implies that social media users are now
bearish about the coin. Santiment has noted that this sentiment,
which is the most negative in years, has come for XRP as a failed
Bitfinex hack attempt has taken place. During this attack, someone
tried to make use of the “partial payments” system of the
cryptocurrency to trick the exchange into thinking the transfer
amount was greater than it actually was (equal to half the asset’s
circulating supply, in fact). Bitfinex, however, had the correct
configuration in place to read transactions of this type, so the
platform never fell for the exploit. Even though nothing ended up
happening, the initial confusion naturally worsened the sentiment
around the asset. Related Reading: How Low Can Bitcoin Go?
CryptoQuant Head Reveals Target This negative sentiment, though,
can actually be a boon in disguise for XRP, as historically, the
price has tended to move against the expectations of the majority.
This might also be the reason that the recovery attempt earlier in
the year failed, as traders got too hyped too quickly. Since the
sentiment is completely opposite now, perhaps a price surge might
have an easier time growing up. XRP Price Since the asset’s failed
recovery attempt, XRP has been moving mostly sideways, as it
currently trades around the $0.576 level. The price of the coin
seems to have been stuck in consolidation recently | Source: XRPUSD
on TradingView Featured image from Kanchanara on Unsplash.com,
charts from TradingView.com, Santiment.net
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