Is the market oblivious to XRP? Solve the mystery of its price decline.
XRP: Everything, No Jamming - Why Is There No Demand for the Alternative Currency?
XRP fundamentals are running at full capacity, yet price movement remains weak.
On-chain data reinforces the likelihood of its value decline.
Ripple [XRP] has been the talk of the town recently, yet the market seems not to have realized it.
Despite the convergence of bullish macro and micro factors, the fear of missing out is still noticeably absent. It seems as if all the main catalysts are impactful, yet the market's reaction has yet to show.
Solve the Ripple Paradox
Ripple (XRP) closed the month of April with an astonishing monthly return of 11%, but this was not solely attributed to a reduction in market fears and doubts.
Institutional investors have been actively accumulating Ripple coins, adding over 900 million Ripple tokens to their holdings in just the past month.
Moreover, Ripple has achieved two significant milestones in the ETF space: launching the Ripple Instant Trading Fund in Brazil and listing Ripple futures contracts on Wall Street. Is there institutional interest? Well.
And just when you thought the news cycle was starting to calm down, the stablecoin Ripple, RLUSD, received official approval from the U.S. Treasury Department.
This places it alongside giant stablecoins like USDC and USDT. Thus, it represents an important step forward in practical use cases.
Yet, strangely, the general market enthusiasm remains stagnant.
Is the market undervaluing XRP?
If you’re wondering why XRP’s value continues to decline despite all the bullish hype, the on-chain data may have the answer.
To begin with, the creation of new addresses on the XRP ledger has sharply declined since December, even though price movement has returned to the same levels. What does that mean? Individual interest is not sufficient.
And it’s more telling: daily active addresses have decreased by 46% since the beginning of the year, now only reaching 21,282. This is a clear sign that this rise is driven by more expert hands rather than new faces.
And do you remember the massive outflows from Binance that exceeded a billion XRP five months ago? It has dropped to only 108 million, even lower than pre-election levels.
Ripple XRP Outflows
Source: CryptoQuant
In short, the slowdown in activity indicates that investors are in a 'wait and see' mode, despite the growing list of bullish catalysts.
In the meantime, speculation continues to swirl, with bold calls for XRP to reclaim the $3 level in the near term.
However, with the absence of fear of missing out, the current situation resembles a slow burn rather than a sudden spike. It’s a traditional paradox in the world of cryptocurrencies: all the ingredients for a currency's rise are available, yet the public remains unenthusiastic.
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