Your analysis of the XRP market is accurate. Recent on-chain data and price action indeed point to growing bearish pressures, primarily driven by a significant sell-off from large holders and signals that the token’s price may be overstretched relative to its network utility.
A Concerning Signal from the Network’s Health
A key metric flashing a warning sign is the Network Value to Transactions (NVT) Ratio, which has surged recently. A rising NVT Ratio suggests that the token’s market capitalization is growing faster than the value of transactions being settled on its network. This divergence often indicates that the price is being driven more by speculative hype than fundamental, utility-driven demand, a condition that has historically preceded short-term corrections.
Compounding this issue is a noticeable shift in behavior from long-term holders. Data indicates that these investors are becoming increasingly active, moving previously dormant coins. This trend often implies that seasoned holders are beginning to sell, potentially signaling reduced conviction in near-term price gains and a desire to secure profits amid stagnant price action.
Sustained Selling from Large Wallets
The downward pressure is being significantly amplified by the actions of large wallet holders, commonly referred to as “whales”. On-chain reports confirm that short-term holders have shifted into “distribution mode”, meaning they are actively selling their holdings. This behavior, where recent buyers look to cut losses or take profits, directly adds sell-side pressure to the market.
This activity is part of a broader pattern of significant outflows. Recent analysis has tracked large transactions from addresses linked to key figures, including a movement of 50 million XRP (worth approximately $120 million) from a wallet connected to a Ripple co-founder. Such substantial and consistent selling from large entities creates a persistent overhang that can be difficult for the market to absorb.
Navigating the immediate Price Crossroads
From a technical perspective, XRP is testing a critical juncture. The price is currently hovering around $2.41, holding just above a crucial support level at $2.35. A decisive break below this $2.35 support could trigger a steeper correction, with the next key targets seen at $2.27 and even $2.13.
For traders and treasury managers, this environment demands caution. The combination of overvaluation signals and persistent whale distribution significantly raises the risk of a sharp downside move. A break below the $2.35 support could accelerate selling and lead to cascading liquidations in leveraged positions. A defensive approach, with reduced leverage and close monitoring of the $2.35 level, seems prudent until the on-chain selling pressure subsides and the NVT ratio cools from its elevated levels.
