Cryptocurrency analytics firm CryptoQuant has released a remarkable assessment of Ripple (XRP). According to the firm’s data, activity on the XRP Ledger has fallen by 80% since its peak in December, reaching unprecedented lows in recent months.
This decline is not limited to on-chain data. A similar decline is also observed in the XRP futures market. There has been a decrease of approximately 70% in open interest, with these levels last seen in November 2023. In addition, funding rates are also in a downward trend and have turned negative at times.
According to CryptoQuant’s assessment, XRP’s estimated leverage ratio is also on the decline. This ratio is calculated by dividing open positions by the XRP reserves on an exchange and reflects the average leverage usage of users.
Despite all this negative data, the XRP price is only down about 35% from its December peak, a more limited decline compared to other major crypto assets like Ethereum, which has lost close to 60% of its value in the same period.
Another noteworthy data is the continuous decline in exchange reserves on the XRP Ledger. Exchange reserves, which have fallen to levels last seen in July 2023, may indicate that investors prefer to withdraw their XRP from exchanges and store it for the long term.
CryptoQuant claims that this data could be a potential recovery signal for XRP. The relative resilience of the price and the decline in exchange reserves could indicate positive investor sentiment for XRP, even if market conditions remain challenging.
*This is not investment advice.
