Ripple: XRP Profit Share Collapse & Correction?

What to Know:

• Despite recent XRP spot ETF launches, a significant portion of XRP supply remains unprofitable.
• Market fragility is highlighted by a large percentage of XRP tokens held at a loss, indicating potential vulnerability to market corrections.
• Overall crypto market interest has declined, aligning with decreased prices, but this lull may present opportunities for long-term investors.

The XRP market is currently facing headwinds as a substantial amount of XRP tokens remain underwater despite positive developments like the introduction of XRP spot ETFs. Recent data indicates that nearly half of the XRP supply is held at a loss, suggesting that late buyers are at considerable risk. This situation underscores the inherent volatility and risk in the cryptocurrency market.

Glassnode’s data reveals that only 58.5% of XRP is currently in profit, marking the lowest level since November 2024. This means that approximately 26.5 billion XRP tokens are held at a loss, highlighting a market imbalance. This data suggests a top-heavy market structure, where many recent investors are experiencing losses, making the market susceptible to further price declines.

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— XRP whale (@realXRPwhale) January 27, 2025

The introduction of spot XRP ETFs, including Franklin Templeton’s EZRP, has not significantly impacted XRP’s price trajectory. Canary Capital’s XRPC ETF has attracted substantial inflows, but the underlying crypto asset has still decreased by 40% since its all-time high in July. This discrepancy suggests that while institutional interest is growing, it has not yet translated into sustained price appreciation for XRP.

Broader trends indicate that public interest in the crypto market has waned, reaching its lowest point since June, according to Google search data analyzed by Alphractal. Declining prices in Bitcoin, XRP, and other cryptocurrencies have dampened investor enthusiasm. Historically, interest returns when market volatility increases and prices begin to rise, which could signal future buying opportunities.

In conclusion, the XRP market is at a critical juncture, with a large portion of tokens held at a loss and broader market interest declining. While the introduction of XRP spot ETFs represents a step forward for institutional adoption, it has not yet translated into significant price gains. Investors should remain cautious and consider the potential for market corrections, while also recognizing the potential opportunities that may arise during quieter market phases.

Related: XRP Price: $12M Max Pain for Bears

Source: Original article