XRP is trading near $1.87 after a roughly 13% decline in 2025, creating a visible disconnect between price performance and the underlying supply-and-demand mechanics described in current market flows. Institutional demand through newly launched spot XRP ETFs and concentrated whale accumulation are tightening available supply, even as near-term selling and cautious retail behavior cap immediate upside.
ETF-driven demand has been persistent and sizable. Spot XRP ETF inflows are reported at roughly $1.14 billion cumulatively, alongside claims of 30 consecutive days of net inflows, and the funds have outpaced Bitcoin and Ethereum ETFs during certain windows by attracting about $79 million while broader markets saw outflows.
Why strong inflows do not automatically translate into spot-price breakouts
A key nuance is where ETF accumulation happens. ETF inflows are often executed off-exchange, which can reduce visible liquidity without producing the same immediate price impact that live spot buying on public order books typically creates. For institutional treasuries and compliance teams, the operational implication is clear. Traditional signals such as exchange order books or certain on-chain snapshots may understate real demand, complicating short-term liquidity planning and execution assumptions.
On-chain concentration metrics reinforce the tightening-supply narrative. Whale-tier holdings are described as reaching seven-year highs, with more than 48 billion XRP concentrated in large wallets, and addresses holding 100 million to 1 billion XRP reportedly adding about 330 million tokens. At the same time, custodial movements have reduced exchange availability. Roughly 800 million XRP were reportedly removed from exchanges in December 2025, adding to the perception of a shrinking immediately tradable float.
Exchange reserves are now a central input for market supervision and execution planning because they reflect how much XRP is readily available to sell. Binance’s XRP inventory is cited as declining to around 2.71 billion XRP, while aggregate exchange balances reportedly fell from over 4 billion to roughly 1.5–1.7 billion XRP, a compression that can increase sensitivity to large orders.
The offset: whale profit-taking and supply-side bursts
Even with tightening reserves, supply does still show up—and it can blunt price response in the short run. Some whales are described as taking profits by selling roughly 200 million XRP within 48 hours around the ETF launch, partially offsetting institutional inflows and contributing to muted spot performance despite strong demand signals. This mix of accumulation and distribution creates a market where direction is less about “demand exists” and more about whether demand can consistently absorb episodic sell-side bursts.
The resulting setup is operationally challenging rather than straightforwardly bullish or bearish. Constrained visible liquidity raises execution risk and increases the probability of sharp, rapid moves, while intermittent whale selling and retail risk aversion can suppress breakout attempts and keep price action range-bound. For traders and crypto treasuries, the core takeaway is to treat liquidity as fragile. Shrinking reserves can amplify market impact, but the presence of profit-taking whales means supply shocks can still arrive quickly and neutralize inflow-driven momentum.