XRP Selling Pressure: Warning Signs Emerge as Big Earners Sell $68.5M Daily

Recent price movements in the cryptocurrency market have brought significant attention to XRP. While the token has seen notable gains, on-chain data is now flashing crucial warning signs regarding potential XRP selling pressure. Are the biggest earners cashing out, and what could this mean for the future of XRP’s price?

Understanding XRP Selling Pressure from Profit Taking

Data from Glassnode reveals that XRP investors who acquired tokens before the late 2024 rally (when XRP was trading below $0.50) are currently realizing substantial profits. This group, which has seen returns exceeding 300%, is responsible for an average of $68.8 million in realized profits daily over the past week. This significant XRP profit taking activity suggests a wave of distribution is underway as these early buyers capitalize on their gains.

Key data points indicating this trend:

Realized Profit Metric: The daily realized profit from holders with over 300% gains has surged dramatically.
Comparison to 2017: This pattern of profit realization by high-margin holders mirrors the behavior observed just before XRP’s 2017 cycle peak, which was followed by a significant downturn.
Distribution Wave: The consistent, high volume of realized profit signals that long-term XRP holders are actively selling into the current market strength.

How Recent Market Structure Impacts XRP Price Prediction

Adding to the concerns about XRP selling pressure is the composition of the current market capitalization. Over 70% of XRP’s realized market cap has been established since late 2024. The realized cap metric tracks the price at which each token last moved, providing insight into the average cost basis of the circulating supply.

What does this mean for XRP market analysis?

Top-Heavy Structure: A large percentage of the supply is held by relatively newer investors who bought in at higher price points compared to the cycle lows.
Increased Vulnerability: This concentration in newer holders makes the market more susceptible to sharp sell-offs during periods of volatility, as these holders have a higher average cost basis and may be quicker to sell to protect profits or limit losses.

Examining Holder Behavior and Downside Risk

Further on-chain analysis using metrics like SOPR (Spent Output Profit Ratio) and Realized Price by age cohort provides more granular detail on potential price floors and risks. The SOPR for holders who bought 3-6 months ago has been declining, suggesting these newer buyers are selling at diminishing profits or even losses, while older cohorts show more stability.

Understanding potential XRP price prediction scenarios:

Newer Holder Pressure: Holders from the 3-6 month cohort (average buy price around $2.28) are currently near their breakeven point at XRP’s trading price around $2.14 (at the time of data). Continued selling from this group could exert downward pressure.
6-12 Month Holder Cushion: The 6-12 month cohort has a lower average buy price, around $1.35. This group has a roughly 35% downside cushion before facing breakeven pressure.
Potential Price Targets: If selling persists, XRP could potentially decline towards the $1.50-$1.60 range, and a retest of the $1.35 level becomes plausible, aligning with the realized price of the 6-12 month holder group.

Technically, the $1.30 level is also highlighted as a potential downside target based on a descending triangle pattern observed on the weekly chart, a formation often considered bearish when appearing after an uptrend. This technical view aligns with the on-chain indicators suggesting increased XRP selling pressure.

Conclusion: Navigating the Risks

While XRP has demonstrated strong performance, the data points to significant XRP profit taking by early investors and a market structure increasingly reliant on newer XRP holders. This combination creates a environment where sharp corrections are a tangible risk. On-chain metrics and technical patterns collectively suggest a potential 35% decline towards the $1.35-$1.60 range is a scenario to consider in any XRP price prediction. However, it’s crucial to remember that market dynamics can change, and a strong bounce, perhaps from a key support like the 50-week EMA, could invalidate this bearish outlook and pave the way for higher prices. As always, conducting thorough personal research is vital before making investment decisions in this volatile market.