Ripple (XRP) has been struggling to recover to the $1.90 price level. Every time its price comes close to this point, it seems to face rejection and falls back. For example, earlier this week, Ripple’s price dropped significantly. On December 29, buyers tried to make its price go higher. However, just when Ripple neared $1.91, more sellers stepped in, which pushed the price down again.
Recent data shows that XRP is facing high selling pressure. Selling pressure refers to how many people are trying to sell an asset compared to those wanting to buy it. This selling pressure has coincided with a larger market correction—or drop in overall market prices. Ripple’s price has fallen by around 50%. At one point, XRP was valued at about $3.66, but now it hovers around $1.85.
XRP Under Pressure
According to data from CryptoQuant, a company that analyzes blockchain activity, the selling pressure on Ripple can be seen in how much XRP is being moved to centralized exchanges like Binance. Binance is the largest cryptocurrency exchange by trading volume globally. When cryptocurrency is moved into exchanges, many experts see this as a sign that people might sell their holdings soon.
For a while, XRP’s inflow into exchanges was stable and moderate, meaning the amount of Ripple being sent to exchanges didn’t change much. However, that is no longer the case. Starting December 15, the amount of XRP sent to exchanges has jumped significantly. The daily inflow to Binance ranged from 35 million XRP to as high as 116 million XRP, with the peak happening on December 19.
CryptoQuant says this trend of increasing inflows shows how investor behavior is changing. Long-term holders—those who kept XRP for a long time—are now selling some of their holdings to take profit from the recent rally. On the other hand, newer investors who bought XRP recently are selling because they’re worried as the price keeps dropping. These newer investors might be selling at a loss.
This mix of long-term holders taking profit and newer investors giving up is creating more selling pressure. As long as these inflows—more XRP being sent to exchanges—continue or grow, XRP is unlikely to see a steady price increase or a phase where buyers accumulate more XRP. If this situation persists, the price correction could last longer and Ripple’s value might drop even further.
Institutional Appetite
Even though XRP prices are facing challenges, institutions and larger investors seem to have a growing interest in Ripple. In countries like the United States, investors can invest in XRP through a special type of financial product called Spot ETFs. Spot ETFs allow people to invest in XRP without needing to buy the cryptocurrency directly.
A report from SoSoValue shows that since November, XRP Spot ETFs have received inflows totaling $1.14 billion. This means investors have poured $1.14 billion into these investment products up until December 26. In fact, these XRP investment funds have performed better than similar products for Bitcoin (BTC) and Ethereum (ETH) since they were launched. Currently, spot ETF funds hold a total of $1.25 billion worth of assets.
While Ripple is facing selling pressure in regular cryptocurrency markets, institutional interest through Spot ETFs shows that larger investors are still willing to bet on XRP. However, it remains to be seen whether this interest can counteract the current decline. For now, rising exchange inflows hint that Ripple’s price may continue to face difficulties before stabilizing or rebounding.