XRP Market Weakens as 41.5% of Supply Sits at a Loss

XRP is facing mounting pressure as on-chain data shows that 41.5% of the circulating supply is currently at a loss, raising concerns about deeper downside risk. Despite the asset trading more than four times higher than it did last year, many holders remain underwater, creating a fragile market structure that analysts warn could lead to additional selling.

Large Share of XRP Supply Falls Into Loss

Crypto analytics firm Glassnode revealed in a recent update that the amount of XRP in profit has dropped to its lowest level since November 2024, when the asset was priced at around $0.53. Today, XRP trades near $2.14, yet a significant 26.5 billion XRP sits at unrealized loss.

Glassnode called this a sign of a “top-heavy and structurally fragile market dominated by late buyers.” This means that even though XRP is still well above last year’s prices, many traders entered during peaks and are now holding losing positions.

Late Buyers Now Under Pressure

IG Australia market analyst Tony Sycamore told Cointelegraph that the recent decline caught many XRP investors off guard. He explained that a large number of buyers entered when XRP traded above $3.00, including during:

• January

• July

• August

• September

• Early October

These entry points left their average cost far above current market prices, creating a scenario where sentiment can flip negative very quickly.

Sycamore noted that XRP’s 40% drop from its July high of $3.66 has surprised both long-term holders and newer traders. Many believed the asset would maintain its bullish momentum after repeatedly testing higher levels earlier this year. Instead, the sharp decline has shifted expectations and forced investors to reassess their risk.

Growing Risk of Forced Selling

According to Sycamore, the widespread unrealized losses now increase the probability of stop-loss triggers, forced sales, and panic exits if the downward trend continues. This could create a feedback loop where selling pressure intensifies, pushing prices down further.

He emphasized that a decisive rebound above $2.70 is needed to restore confidence in the short term. Without this recovery, charts and sentiment may continue to tilt bearish.

Market Structure Weakens as Bulls Lose Key Levels

XRP’s chart reflects the broader loss of momentum. After reaching a new all-time high earlier this year, the asset has steadily pulled back for several weeks. A break below the $2.00–$2.10 region could expose the market to deeper corrections, especially if long-term holders finally begin reducing exposure.

The combination of uncertain sentiment, macroeconomic pressure, and large underwater positions has contributed to XRP’s increasingly fragile structure.

ETF Wave Brings Hope — But No Immediate Price Boost

Despite the negative trend, there is one factor that investors hope can bring back strength: the ongoing wave of exchange-traded funds (ETFs) for XRP.

Last week, Canary Capital launched the first spot-XRP ETF in the United States. It delivered the best first-day performance among all new ETFs this year — a sign that institutional interest may still be building.

Several more ETFs are set to launch in the coming days, including products from:

• Franklin Templeton

• Bitwise

• 21Shares

• CoinShares

This makes XRP one of the most widely supported digital assets in the emerging ETF landscape, second only to Bitcoin and Ethereum.

However, despite these developments, the price has not yet responded with any meaningful upside. XRP continues to drift near $2.14, down more than 40% from its July peak of $3.65.

Will ETFs Spark the Next XRP Recovery?

Analysts say that while ETFs can bring long-term demand, they are unlikely to provide an instant boost. Market conditions remain cautious, and many investors are waiting to see whether ETF inflows materialize at scale.

Still, ETFs give XRP a powerful advantage: they open the door to institutional capital, retirement accounts, and traditional market participants who previously had no access to the asset.

If these funds attract steady inflows over time, analysts believe they could help stabilize XRP’s price and potentially support a long-term recovery.

Outlook: XRP at a Critical Turning Point

XRP’s current market structure leaves the asset at a critical junction:

• 41.5% of supply in loss increases the risk of more downside.

• A recovery above $2.70 is needed to ease bearish pressure.

• ETFs introduce new long-term demand but may take time to impact price.

For now, XRP remains vulnerable, and analysts warn that losing key support levels could trigger further declines. The next few weeks — including ETF launches and broader market shifts — will be crucial in determining whether XRP can regain strength or continue sliding.