- XRP selling pressure has decreased in the short term, based on metrics and price action.
- The rise in the leverage ratio is the result of bullish optimism, but also a warning for futures and perp traders.
XRP made news this week after hitting a 7-year high and surpassing the $3 mark on the charts. Since January 1, the altcoin has gained 52%, with whale accumulation also strong. In fact, whales have purchased over 1.4 billion XRP in the past two months – a 35% increase in demand.
The measurements also revealed a reduction in XRP deposits on exchanges. Thus, AMBCrypto analyzed this development along with other metrics to understand whether or not they bode well for XRP bulls.
XRP – Mixed signals need to be decoded
Source: CryptoQuant
This metric tracks the total number of deposit transactions to exchanges. The higher the number, the greater the likelihood of an impending wave of sales. A higher number of deposits generally indicates selling pressure. This could also involve more margin trading, using XRP as collateral.
During the consolidation phase in December, XRP deposits saw significant increases. However, the bulls managed to hold the psychological support of $2 in the face of selling pressure. In fact, during its last rally, deposits were weak, meaning that selling pressure has remained relatively low in recent days.
Source: CryptoQuant
In early November, the price of XRP began to rise rapidly. The Estimated Leverage Ratio (ELR) metric has also moved upward. The ELR is the exchange’s open interest divided by its coin reserves. This helps track whether or not participants are engaged in higher leverage trades, which typically happens during a strong uptrend.
The ELR saw some respite in the second half of December thanks to consolidation. The recent breakout beyond $3 has pushed ELR higher, sending a warning signal to traders.
Source: CryptoQuant
Over the past two weeks, XRP exchange reserves have increased. This can be seen as a bearish sign, one at odds with the decline in the number of deposits.
The conclusion is that there may be some selling pressure related to profit taking, but not enough to stop the increases. This finding makes it more likely that traders used XRP as collateral in margin trading.
Read Ripple (XRP) Price Prediction 2025-26
The rise in ELR and foreign exchange reserves, combined, suggests that volatility could hurt traders in the short term. A hunt for liquidity and a period of consolidation could follow, but it is unclear when this might take place.
