XRP (XRP) recovered 50% to a high of $1.67 from its 15-month low of $1.12 reached on Feb. 6. While the altcoin’s intraday price of $1.43 remains more than 60% below its multi-year high of $3.66, several metrics suggest that the local low at $1.12 could be the new bottom with XRP price set for a sustained recovery.
Key takeaways:
XRP supply on exchanges has dropped to a five-year low as holders moved tokens to self-custody, possibly signaling reduced selling pressure.
Funding rates are at extreme lows, suggesting a potential bottom.
Positive spot taker CVD, and steady ETF inflows signal strong buyer and institutional demand for a rebound.
Falling XRP supply on exchanges is bullish
There has been a notable decline in the XRP supply held on exchanges over the past two years, as indicated by data from Glassnode. The XRP balance on exchanges dropped to 12.9 billion XRP on Tuesday, matching with levels last seen in May 2021.
A falling token balance on exchanges suggests a lack of intention to sell by holders, possibly reinforcing the future upside potential for XRP.
Additional data from CryptoQuant reveals that Binance’s XRP reserve has dropped sharply to around 2.57 billion XRP, with both the SMA(50) and SMA(100) sloping downward.
Related: XRP analysts explain why price drop below $1 ‘remains possible’
“Technically, reserves are declining while price remains near the lows,” said CryptoQuant contributor PelinayPA in a Monday Quicktake analysis.
This structure increases the probability of a potential short squeeze scenario ahead.
XRP funding rates fall to extreme lows
Binance funding rates fell to -0.028% as the price dropped to $1.12 on Feb. 6, the lowest level since April 2025. Combined with falling spot prices, negative funding rates reflect overcrowded shorts and capitulation among leveraged longs.
Historically, extreme negative funding often signals a potential bottom or short squeeze, as the market becomes oversold.
Similar funding conditions in April 2025 preceded a 65% rally to $2.65, from $1.60, as shorts were squeezed out.
Comparable setups in late 2024 triggered sharp upside moves as traders rushed to close positions.
Meanwhile, XRP futures open interest (OI) has decreased to around $2.53 billion on Tuesday, down 55% from peaks of $4.55 billion recorded in early January, data from CoinGlass shows.
This suggests that leverage traders are reducing their exposure rather than opening new positions, signaling weakening bearish conviction and possible price reversal if buying pressure returns.
XRP spot taker CVD signals high buyer volumes
Analyzing the 90-day spot taker cumulative volume delta (CVD) reveals that buy orders (taker buy) have become dominant again. CVD measures the difference between buy and sell volume over a three-month period.
Until late yesterday, the CVD remained neutral, reflecting indecision in the market.
This metric flipped positive on Tuesday (green bar in the chart below), indicating a rebound in demand, with buyers regaining control.
If the CVD remains green, it would mean buyers are buying more at lower levels, which could set the stage for another leg upward, as seen in historical recoveries.
Spot XRP ETFs inflows continue despite crash
US-based spot XRP exchange-traded funds (ETFs) continued to attract investor interest, with these investment products recording inflows 53 days out of 59, underscoring persistent institutional demand since their launch in November 2025.
Spot XRP ETFs added $4.5 million on Friday, bringing cumulative inflows to $1.23 billion and total net assets under management to over $1.01 billion, according to SoSoValue data.
Similarly, while global crypto investment products logged the fourth week of outflows totaling $173 million, XRP ETPs bucked the trend, emerging as the top performer with inflows of $33.4 million during the week ending Feb.13.
This reinforced the steady institutional demand for XRP-based ETPs, even as the market price weakened.
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