XRP price spiked to over $0.90 on U.S. cryptocurrency exchange Coinbase on Nov. 24, only to crash back down by roughly 30% in seconds. This was the highest price level since May 2018.

XRP frenzy driven by Coinbase users

The rally was apparently driven by Coinbase users as the price of XRP did not see the same heights on other exchanges. Bitstamp and Binance, for example, saw a high of only $0.79 during the same spike.

Shortly after the crash, the hashtag “Coinbase” began trending on Twitter in the United States.

XRP/USD 1-minute chart (Coinbase). Source: Tradingview

While Coinbase’s official status page currently says that everything is operating normally, other sources show that the exchange is indeed experiencing problems.

Coinbase service outage. Source: Downdetector

“WHAT CRAP — new to coinbase — and all my XRP trades went into limbo then finally showed up only AFTER the bottom fell out — causing me to lose a ton of money!!!” user Mike Palagi wrote in one of the comments on Downdetector.

What caused the crash?

The rally may have been triggered in late October when an anonymous whale sent $50 million worth of XRP at the time to Bitstamp. Since then, XRP/USD has been seeing a strong parabolic uptrend, up by 137% in the past week to its highest levels in over two years.

Before the price spike and immediate crash, popular pseudonymous trader “CryptoSqueeze” noted that the funding rate for XRP turned negative. He said:

“Negative funding on XRPUSDT on FTX and OKeX. What could go wrong?”

Throughout the rally, the funding rate for the XRP perpetual swap contract on Binance remained at 0.01%. This meant that there was an even balance between buyers and sellers as the price surged over 35% in one day.

Although the short squeeze initially led the rally, sources who preferred not to be named told Cointelegraph that some market makers on Coinbase pulled their orders as the rally became overheated.

Despite the current rally, XRP is still down 78% from its all-time high in January 2018. In Bitcoin (BTC) terms, XRP is down 83% from its all-time high, though technical analysis suggests that the multi-year downtrend may have been broken last week.