The recent downturn in XRP’s price is increasingly perceived not merely as typical underperformance but as capitulation. Long-term holders who invested over $2 per coin in the past year are now facing significant losses amounting to millions.
Data from Glassnode reveals that this group has been liquidating positions at a rate of approximately $20 million to $110 million daily, amid a 55% price drop in the last six months to around $1.30.
This trend suggests current selling pressure stems more from risk reduction than profit-taking during market strength. Consequently, the market is saturated with pressured late buyers, while earlier investors who accumulated at sub-$1 levels still have room to offload positions.
The implications of this dynamic are critical. XRP faces the least supportive kind of selling, where recent purchasers are liquidating due to losses, and earlier holders can sell into rallies, making the token susceptible to fleeting recoveries unless demand strengthens sufficiently to accommodate both groups.
As a result, XRP has experienced its longest losing streak since 2014, creating a market structure prone to difficulty maintaining rebounds. The significant aspect of this decline is its origin; unlike previous cycles where sales occurred during price hikes and profit-taking, the current selling coincides with market weakness—a pattern described by analysts as ‘distribution into weakness,’ indicating waning confidence in XRP’s near-term trajectory.
This environment complicates efforts to halt further declines. Recent buyers are now dealing with losses while earlier investors remain profitable and can still reduce exposure during rallies, resulting in a fragile market structure where each price recovery triggers loss-cutting or profit-taking by different groups.
Santiment data corroborate this scenario: wallets active on the XRP Ledger over the past year have seen an average 41% reduction in their holdings—the weakest mean-to-realized value ratio for XRP since FTX’s collapse in November 2022. This highlights the depth of recent positioning losses and explains why the market has struggled to establish a sustainable recovery.
Moreover, the broader crypto environment has not favored XRP; its downturn coincided with a wider risk-off period across digital assets, with Bitcoin falling from highs above $126,000 to around $66,000. Traders have shown reduced interest in chasing assets lacking clear short-term catalysts amid deteriorating holder behavior.
While the spot market shows some support—with Binance’s spot cumulative volume delta climbing to about $520.2 million according to CryptoQuant data—the perpetual cumulative volume delta remains negative by approximately $261 million, indicating a lack of significant repositioning by leveraged traders.
This divergence explains why XRP appears supported yet remains weak; while spot demand can mitigate price declines, the defensive stance in futures trading means rallies often lack momentum. Although stability is possible under these conditions, a new catalyst is typically required for a decisive trend shift.
Whale behavior also aligns with this outlook. CryptoQuant reports that daily whale inflows into Binance have decreased to about 12.6 million XRP, with the 30-day cumulative flow falling to around 1.44 billion XRP from roughly 2.6 billion in March. This reduction suggests large holders are withdrawing supply from exchanges, easing immediate selling pressure but not necessarily creating demand.
Despite Ripple’s operational improvements—including a settlement with the US SEC and strategic acquisitions—the market remains cautious. Institutional momentum around XRP is reportedly growing, as noted by Evernorth CEO Asheesh Birla, who cites regulatory progress and blockchain activity as positive signs. However, SoSoValue data show that XRP ETFs recorded their first monthly net outflow over $31 million in March, ending a period of strong inflows.
This hesitation indicates investors remain wary about assigning near-term premiums to the token, despite Ripple’s advancements. Consequently, XRP is caught between a potentially constructive long-term outlook and its current status as a crowded and pressured asset, weighed down by weak selling dynamics and a derivatives market yet to confirm recovery.