XRP Whale Activity and Market Divergence: Identifying Bullish Reversal Signals Amid Accumulation and On-Chain Trends

The XRP market in late 2025 has exhibited a fascinating duality: while retail sentiment remains bearish and technical indicators show signs of weakening momentum, on-chain data and institutional activity suggest a potential bullish reversal. This divergence, driven by strategic whale accumulation, elevated network velocity, and sustained institutional inflows, paints a complex picture of market dynamics. For investors, understanding these signals could be key to navigating the next phase of XRP's trajectory.

Whale Accumulation and Strategic Positioning

XRP whales have been aggressively accumulating tokens in late 2025, with large wallet holdings surpassing 7.8 billion XRP-a seven-year high. Despite a 20.6% reduction in the number of wallets holding at least 100 million XRP over eight weeks, the remaining wallets now control over 48 billion XRP. This concentration of holdings suggests a shift from distribution to strategic accumulation, a pattern historically linked to price rebounds. For instance, similar whale behavior in 2018-2019 preceded significant XRP rallies. The exit of 569 large wallets, while seemingly bearish, may indicate a consolidation of power among fewer, more committed holders, reducing short-term selling pressure.

On-Chain Velocity and Liquidity Surge

The XRP Ledger (XRPL) has seen a dramatic rise in on-chain velocity, hitting a yearly high of 0.0324 in December 2025. This metric, which measures how frequently tokens change hands, reflects heightened liquidity and active participation. CryptoQuant interprets this as a sign of robust network engagement, with XRP being used for trading, transactions, and other utility-driven activities rather than remaining dormant. The surge in velocity aligns with increased whale activity, as large holders move tokens into cold and custodial wallets, further reducing immediate sell pressure.

Institutional Inflows and ETF Dynamics

Institutional confidence in XRP has remained resilient despite broader market volatility. In a single week in late 2025, XRP attracted $70.2 million in institutional inflows-the largest among crypto assets during a period when Bitcoin faced outflows. This trend is reinforced by XRP ETFs, which have accumulated $1.12 billion in assets despite price weakness. The divergence between inflows and price action suggests that institutional investors view XRP as undervalued, a dynamic often preceding bullish reversals. Standard Chartered analysts project XRP could reach $8 by 2026, citing sustained ETF inflows and regulatory clarity post-SEC settlement.

Technical Divergence and Key Levels

While on-chain and institutional data lean bullish, technical indicators present a mixed picture. XRP's price near $1.86 has shown signs of bottoming, with bullish chart patterns emerging.

However, the Relative Strength Index (RSI) has declined, and volume-volume divergence suggests distribution rather than accumulation. Critical support at $1.81–$1.90 must hold to maintain bullish momentum, while a break above $2.28–$2.44 could trigger a short squeeze toward $3.00. Analysts caution that increased exchange deposits-indicating holders preparing to sell-add complexity to the near-term outlook.

Market Divergence and Future Catalysts

The interplay between bearish retail sentiment and bullish on-chain/institutional signals creates a classic market divergence scenario. Historical precedents, such as the 2018-2019 XRP rally, suggest that whale accumulation often precedes price rebounds. The August 2025 SEC settlement, which resolved a long-standing regulatory dispute, has further removed barriers to adoption, potentially attracting new institutional capital. If XRP's price stabilizes above key support levels and whale accumulation continues, the asset could see a reversal toward $2.80–$3.50 by 2026.

Conclusion

XRP's late-2025 market dynamics reflect a tug-of-war between short-term bearishness and long-term bullish fundamentals. Whale accumulation, elevated on-chain velocity, and institutional inflows signal a market poised for a potential reversal, provided technical support holds. For investors, monitoring whale activity, ETF flows, and regulatory developments will be critical in navigating this divergence. As the XRP Ledger continues to process millions of low-cost transactions daily, the asset's utility and adoption story remains intact-a foundation that could underpin a sustained rally in the coming months.