XRP faces $45M supply shock as ETF inflows wane — recovery at risk
XRP fell below its realized price, leaving many holders underwater, and is struggling to reclaim that key psychological level. XRP spot ETF inflows have cooled after an initial surge, with net flows turning negative in late January and only modest recovery in February — total net assets for ETFs have declined. On-chain data show a single-day transfer of over 31 million XRP to Binance from large holders, implying roughly $45 million of potential short-term sell pressure if that supply is sold. Santiment recorded the largest realized loss spike for XRP since 2022, signaling panic selling; historically similar loss spikes have sometimes preceded multi-month rallies. Immediate implications: continued selling pressure and weak ETF demand make short-term recovery uncertain, while a capitulation-driven bottom could enable a medium-term rebound if ETF inflows resume and exchange sell pressure eases.
Bearish
The piece points to several bearish indicators: XRP trading below its realized price (most holders underwater), weakening ETF inflows (net flows turned negative), and a large one-day transfer of ~31M XRP to Binance (~$45M potential sell supply). Historical context — a spike in realized losses — could indicate capitulation, which sometimes precedes a recovery, but capitulation itself is short-term bearish. The immediate probability favors increased selling pressure and price weakness until (a) sizable ETF inflows resume to absorb supply, (b) the large Binance inflow is not sold into the market, or (c) on-chain metrics show reduced outflows from large holders. Short-term impact: higher volatility, downward price pressure, possible test of lower supports. Medium-term: if panic selling exhausts supply and ETFs regain traction, a recovery is plausible as seen in past cycles where realized-loss spikes preceded rallies. Traders should monitor ETF net flows, exchange inflows/outflows (especially large transfers to Binance), realized price levels, and realized-loss metrics to time entries or manage risk.