XRP is experiencing increasing supply pressure as exchange reserves continue to decline while institutional demand strengthens. The latest wave of accumulation is being driven by U.S. spot XRP ETFs, which have seen repeated days of inflows.
Exchange XRP Reserves Fall to Multi-Month Lows
New data from CryptoQuant shows a sharp decline in Binance’s XRP holdings, now sitting at their lowest levels in months. Reserves have dropped to around 2.7 billion XRP, marking one of the most intense accumulation periods recorded this year.
This steady reduction in exchange supply suggests that long-term holders and institutional buyers are withdrawing XRP from trading platforms. As a result, the token’s price dynamics may be shifting. According to TradingView, XRP trades at $2.18, down nearly 2% in the past 24 hours.
CryptoQuant contributor Darkfost noted that the ongoing reduction in exchange reserves reflects growing long-term investor confidence. He also suggested that XRP may be entering a new market phase, a sentiment echoed across the community amid discussions about native XRP staking. A Ripple developer recently emphasized that staking decisions will ultimately depend on institutional involvement rather than retail participation.
Rising ETF Inflows Add to XRP Supply Tightening
The market is mirroring previous cycles where heavy accumulation occurred as major assets became regulated investment products. A significant drop in XRP’s exchange supply coincides with strong inflows into spot XRP ETFs.
According to SoSoValue, spot XRP ETFs recorded more than $21 million in inflows on Wednesday. Franklin Templeton, Canary, Bitwise, and Grayscale all reported positive flows.
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Bitwise led with $7.4 million
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Franklin Templeton added $4.8 million
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Canary secured $5.2 million
These continuous inflows highlight the growing appetite from wealth managers and institutional investors seeking regulated exposure to XRP. The price previously reacted positively when spot ETFs attracted over $164 million in cumulative inflows.
With the circulating supply shrinking, reduced selling pressure may help support further price appreciation—provided demand continues to strengthen.
Analyst Warns ETF Demand Could Outpace XRP Supply
Strategist Chad Steingraber has raised concerns about how rapidly ETF demand could exceed the available liquid supply. Using a hypothetical scenario where XRP ETFs receive $1 billion in inflows in a single day, he estimates issuers would need more than 229 million XRP at current prices.
Extending this scenario over six months results in demand exceeding 27.5 billion XRP, far surpassing the liquid supply across all exchanges.
Steingraber cautioned that if ETF inflows remain aggressive without price adjustments, XRP could become scarce for retail traders. He believes the price must rise in line with demand to avoid significant market shortages, possibly within the next year if inflows accelerate.
