Long-Term Holders Held Firm, Even as XRP Price Lost 40%

XRP’s price dropped by nearly 40% in recent weeks, falling from $2.35 to $1.40. Despite the decline, long-term holders increased their positions by 200%, stabilizing the market. This behavior indicates strong conviction among core investors.

Short-term speculative holders exited the market during the decline, reducing overall volatility. Their departure led to a reduction in selling pressure, which helped balance market dynamics. Institutional flows remained positive, suggesting continued interest in XRP.

Leverage levels in XRP futures markets have declined to 0.16, signaling a normalization of speculative activity. This shift has reduced the risk of flash crashes and improved overall market stability.

Why Did This Happen?

XRP ETF inflows have dropped sharply by 93%, coinciding with the weakening price. This decline reflects a temporary pause in institutional accumulation, which had previously supported market stability and adoption. The slowdown may be cyclical, typical of new investment products after rapid growth phases.

Spot XRP ETFs launched in November 2025 with major issuers such as Canary Capital, Bitwise, Franklin Templeton, Grayscale, and 21Shares. Early inflows were strong, reaching over $1 billion in assets under management within weeks. However, recent data shows a significant decline in inflow activity.

What Are Analysts Watching Next?

Legislative developments, ETF inflows, and market sentiment have contributed to a recent XRP rebound. Optimism around a potential agreement on stablecoin yields and renewed institutional demand for XRP ETFs have driven short- to medium-term bullish expectations.

The Market Structure Bill has been a focal point, with the White House setting a March 1 deadline for a draft. A resolution could improve broader crypto market sentiment. However, geopolitical tensions and regulatory delays remain key risks.

What Is the Market Outlook?

Institutional buying remains active, although inflows have slowed. Approximately $1.2 billion remains tied to XRP, indicating continued interest from institutional players. When investor confidence returns, a recovery is expected.

XRP recently gained 6%, rising to around $1.42, driven by increased spot buying activity. Retail purchase volumes surged by 212%, outpacing selling pressure. Institutional flows have also been constructive, with XRP ETFs accumulating $1.1 billion in net assets since mid-November.

Market participants are monitoring key support and resistance levels to assess the trajectory of XRP’s price. A break above $1.45 would confirm a bullish move and signal further potential for recovery.

The recent drawdown, during which traders realized $1.93 billion in losses, appears to have served as a shakeout, clearing speculative leverage and setting the stage for potential recovery. Traders now watch if XRP can hold support near $1.40 and break resistance at $1.45.