XRP Price Warning: Investor Demand Plummets – Will Bulls Defend $2?
Is the XRP bull run losing steam? After a spectacular surge, investor demand for XRP appears to be faltering as the broader crypto market experiences a stall. Remember the explosive rally between October 2024 and January 2025, where XRP skyrocketed 600%? Those were heady days fueled by hopes of a crypto-friendly presidency. But fast forward to today, and the picture looks different. Are we about to see a significant correction, potentially even testing the critical $2 support level? Let’s dive into the data and analyze what’s driving this shift in market sentiment.
Declining Investor Demand for XRP: Data Speaks Volumes
The numbers don’t lie. The initial euphoria surrounding XRP seems to be fading. While Bitcoin and XRP both enjoyed impressive gains since the 2022 lows (around 500%-600%), XRP’s ascent was largely fueled by a dramatic, almost parabolic, price spike. Data from Glassnode reveals a stark contrast: XRP’s investor demand, measured by daily active addresses, surged a staggering 490% during its peak rally. Bitcoin, in comparison, saw a much more modest 10% increase in the same metric over the past four months. This highlights the speculative nature of XRP’s recent surge and the potential for rapid shifts in sentiment.
| Metric | XRP | Bitcoin |
|---|---|---|
| Price Gain (from 2022 lows) | 500%-600% | 500%-600% |
| Increase in Daily Active Addresses (during peak rally) | 490% | 10% |
This retail-driven frenzy propelled XRP’s realized cap from $30.1 billion to a whopping $64.2 billion. Remarkably, $30 billion of this inflow came from new investors within just the last six months. The proportion of XRP’s realized cap held by these newcomers (those in the market for less than six months) ballooned from 23% to a massive 62.8%, indicating a rapid transfer of wealth to new hands. However, this influx of capital has significantly slowed since late February 2025, suggesting a potential peak in investor demand for XRP.
Profitability Dries Up: Why XRP Holders Are Feeling the Pinch
One of the key reasons behind the cooling investor demand for XRP is a shift in profitability. Investors are simply locking in fewer profits and facing increased losses. This is clearly illustrated by the realized loss/profit ratio, which has been steadily declining since early 2025. Glassnode analysts point to this trend, stating, “Given the retail-dominated inflows and largely concentrated wealth in relatively new hands, this alludes to a condition where retail investor confidence in XRP may be slipping, and this may also be extended across the broader market.” In simpler terms, when people start seeing more red than green in their portfolios, their enthusiasm tends to wane.
Whales Take Profit: A Sign of Further XRP Price Weakness?
It’s not just new investors showing caution. Data on whale address distribution reveals a similar story. We’re witnessing a consistent increase in whale outflows since the beginning of 2025. This suggests that large holders, often considered smart money, have been strategically reducing their XRP positions. Over the past two weeks alone, over $1 billion worth of XRP has been offloaded at an average price of $2.10. When whales start selling, it often signals potential downward pressure on the XRP price.
Can XRP Defend the Crucial $2 Support Level?
The million-dollar question: can XRP hold the line at $2? This level has acted as $2 support level multiple times recently. However, each retest weakens the defense. From a technical analysis perspective, the more times a support level is tested, the higher the probability of it eventually breaking.
Looking at the shorter time frames (1-hour and 4-hour charts), there’s a glimmer of hope in the form of a bullish divergence. This occurs when the price makes lower lows, but the Relative Strength Index (RSI) forms higher lows, suggesting potential buying pressure building up. With a fair value gap identified between $2.08 and $2.13, XRP could experience a relief rally, especially if the broader crypto market sees an oversold bounce.
However, zooming out to the daily chart, a more bearish picture emerges. An inverse head-and-shoulders pattern has formed, with a measured target pointing towards $1.07. There’s a potential support zone around the 200-day moving average (currently in the $1.70 to $1.80 range), but XRP hasn’t tested this level since November 2024. The coming days will be critical in determining whether bulls can defend the $2 support level or if we’re headed for a deeper correction in XRP price.
Disclaimer: This analysis is for informational purposes only and not financial advice. Cryptocurrency trading involves significant risk. Always conduct thorough research and consult with a financial advisor before making any investment decisions.
