Key Observations
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Over 21,000 new XRP wallets were created in 48 hours, marking the fastest growth in eight months.
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Record decentralized exchange transactions coincided with XRP’s price weakness, suggesting potential non-organic activity.
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Whale wallet outflows have stabilized after significant selling, indicating a possible bottom formation for XRP.
XRP Price Movement and Network Activity
XRP experienced a notable price drop, closing Tuesday at $2.20, its lowest point since July 4. It subsequently rebounded by 16% to $2.40 from its monthly low of $2.06 on Thursday. Despite this relief rally, XRP has struggled to regain bullish momentum, with overall market sentiment remaining cautious.
However, onchain data has indicated a resurgence of activity across the XRP Ledger. The analytics platform Santiment reported a significant increase in XRP network participation, with more than 21,000 new wallets created within a 48-hour period. This represents the highest growth rate observed in the past eight months.
Concurrently, data from CryptoQuant highlighted record-breaking transactions on the XRP Ledger's native decentralized exchange (DEX). With 954,000 transactions recorded, it marked the most active day for the DEX in recent months.
Typically, such a surge in activity is indicative of improved network health and growing adoption. However, in this instance, it occurred alongside a noticeable price decline. This divergence has prompted questions regarding the underlying factors driving this increased activity.
Analysts are suggesting that this disconnect might imply that a substantial portion of the transaction volume originates from whale distribution, arbitrage activities, or automated trading strategies, rather than organic user buying.
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XRP Whale Flow Dynamics Suggest Price Stability
XRP's price has been experiencing a sustained downtrend since reaching a peak of $3.66 on July 18. This period was characterized by consistent selling pressure from large holders, often referred to as whales. Over the last 90 days, XRP recorded net negative whale flows exceeding $650 million, reflecting continuous large-scale outflows from whale wallets.
However, recent data indicates a potential shift in this trend. The total whale flows over the past 90 days have turned neutral, which could signal early indications of a market bottom forming for XRP.
Crypto analyst Crazzyblockk observed that futures data on Binance also presented a significant contrast between XRP and major cryptocurrencies like Bitcoin and Ether. While Bitcoin and Ether futures saw substantial declines in open interest, falling to $59.87 million and $148.69 million respectively, XRP's futures positioning remained relatively resilient.
"Traders appear to be rotating into XRP," the analyst stated, "using minor dips to accumulate positions, in stark contrast to the risk-off sentiment dominating BTC and ETH markets."
With the easing of whale selling and an acceleration in new wallet creation, the onchain and derivatives data for XRP suggest a possible stabilization phase. Nevertheless, confirmation from actual price action will be crucial in validating these indicators.
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