Market Vulnerabilities Despite Positive Developments
XRP supply in profit has plummeted to its lowest level since November 2024, even amid a significant price increase and a major ETF launch, according to Glassnode data. This situation indicates a structurally fragile XRP market, with substantial risks of capitulation due to high numbers of holders at a loss.
Glassnode data reveals that XRP supply in profit has dropped to its lowest since November 2024. This has occurred despite a fourfold price increase and the launch of a major ETF. Nearly 41.5% of circulating supply remains at a loss. Ripple's leadership, including CEO Brad Garlinghouse, remains silent on this specific milestone. Glassnode, responsible for the metrics, indicates potential capitulation risk among recent buyers. The Spot ETF launched by Canary Capital has contributed to this attention.
Broader Market Correction and Capitulation Risk
The broader market correction affects XRP supply profitability. BTC and ETH are also experiencing price stress, with Bitcoin dropping below $90,000. This indicates high capitulation risk among recent XRP purchasers. Market Analyst Joe Consorti remarked, "Even with two 30% drawdowns this cycle, the speed and severity of the current drawdown have made it much more severe." Financial implications extend to the Spot XRP ETF launch, marking $59 million in initial trading volume. This underscores the fragile market structure amid current conditions, with a significant proportion of supply being underwater.
Fragile Market Structure and Historical Patterns
XRP's market structure has shown vulnerabilities. Despite the Spot ETF's inflow, price impact lags. This stems from large retail entries at high prices. Rapid post-ETF selling exacerbates the fragile structure, posing risks of further selloffs. Historical trends suggest similar patterns during previous ETF launches. The sector-wide risk-off mood leads to historic levels of XRP loss-holding. Glassnode confirms the data, indicating potential stress points for the market.