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Coinbase’s XRP reserves have seen one of the sharpest declines among major exchanges, raising speculation about institutional accumulation and potential preparation for a Spot XRP ETF. On-chain data suggests the US-based exchange has shed over 90% of its XRP holdings in just three months, sparking debate across the crypto community.
Coinbase’s XRP Holdings See Historic Decline
Data shows that Coinbase, once among the largest holders of XRP, has reduced its balance dramatically. Earlier this year, Coinbase reportedly held around 780 million XRP, placing it among the top five centralized exchanges by XRP reserves. By the second quarter of 2025, that figure had dropped to 199 million XRP, a 69% reduction.
Now, fresh analysis from tracking account @XRPwallets on X (formerly Twitter) reveals an even sharper decline. The exchange currently holds just 99 million XRP across six cold wallets. This represents a 90% reduction compared to the nearly 970 million XRP it held across 52 wallets in June.
Such a rapid reduction in reserves has caught the market’s attention, with many analysts interpreting it as a sign that XRP is being transferred into institutional-grade custodial accounts.
Possible Institutional Accumulation Ahead of ETF
The timing of these withdrawals has fueled speculation that large financial players could be preparing for the approval of a Spot XRP ETF in the United States.
BlackRock, the world’s largest asset manager, has been rumored to be indirectly connected to XRP through its relationship with Coinbase Custody. While no official confirmation has been made, some in the XRP community believe that recent movements are linked to institutional accumulation in preparation for regulatory greenlights.
The odds of an XRP ETF being approved in 2025 have strengthened significantly. On prediction market Polymarket, approval odds stand at 94%, while Bloomberg analysts place them at over 90%. If approved, such a product would open the doors for institutional investors to gain direct exposure to XRP, potentially reshaping demand dynamics.
Market Reaction and Community Debate
The dramatic decline in Coinbase’s XRP reserves has led to mixed interpretations among crypto investors. Some argue that the reduction signals accumulation by long-term holders and institutions who prefer private custody solutions over leaving assets on exchanges.
Others, however, have raised concerns. A user on X suggested that Coinbase’s XRP exits could be part of a broader attempt to suppress the asset’s price. This theory was dismissed by Bill Morgan, a well-known pro-XRP lawyer, who argued that the flows are more likely linked to institutional positioning rather than price manipulation.
The debate underscores the high level of speculation around XRP’s role in the next wave of institutional adoption.
What This Means for XRP’s Price
At the time of writing, XRP is trading at $3, down 2.9% in the last 24 hours. Despite the short-term dip, many analysts see the reduced exchange reserves as a bullish signal.
Lower supply on exchanges typically suggests fewer tokens available for immediate selling pressure. If demand rises, particularly from institutions ahead of an ETF approval, this imbalance could create upward price momentum.
Technical analysts are also watching critical resistance levels. XRP recently completed a Wave 3 move in its Elliott Wave structure, with the next key price to watch at $3.13. Breaking this level could trigger a push toward higher resistance zones.
The Bigger Picture: XRP’s Institutional Future
The sharp reduction in Coinbase’s reserves highlights how rapidly the XRP landscape is shifting. Institutions have been slow to embrace XRP compared to Bitcoin and Ethereum, largely due to its ongoing regulatory battles with the U.S. Securities and Exchange Commission (SEC).
However, recent legal clarity and shifting market sentiment are changing that narrative. With major players like BlackRock rumored to be positioning, and ETF approval odds climbing, XRP may be at the start of a new phase of adoption.
If these developments play out as anticipated, XRP could move from being primarily a retail-driven asset to becoming part of institutional portfolios alongside Bitcoin and Ethereum.
Conclusion
Coinbase’s 90% reduction in XRP reserves is one of the most dramatic exchange outflows in recent memory. While some fear manipulation, the more likely explanation points to institutional accumulation and preparation for a potential Spot XRP ETF.
With regulatory clarity improving and exchange balances shrinking, XRP could face a supply crunch just as institutional demand begins to build. Whether this translates into sustained price gains will depend on both ETF approval and broader market conditions.
For now, one thing is clear: XRP’s role in the institutional crypto market is growing, and the recent outflows from Coinbase may be a signal of bigger shifts ahead.
