XRP ETF attracts over $1 billion in counter-market inflows, is this a market reversal signal?

Just last week, the entire crypto ETP market experienced a net outflow of $446 million, with total outflows since the sharp correction on October 10 reaching an astonishing $3.2 billion. However, XRP-related exchange-traded products defied the trend, recording approximately $70.2 million in weekly inflows. As of December 30, XRP’s trading price was about $1.867.

Capital Exodus

According to CoinShares’ latest report, digital asset investment products have faced two consecutive weeks of outflows. The $446 million net outflow was primarily led by Bitcoin and Ethereum products. Bitcoin ETPs saw nearly $443 million in outflows, while Ethereum products lost $59 million. Since the market shock in October, total outflows from crypto ETPs have risen to $3.2 billion.

CoinShares notes that although the total capital inflow from the beginning of the year to date amounts to $46.3 billion, roughly in line with the $48.7 billion in 2024, the total assets under management have only increased by 10%. This indicates that, considering capital flows, ordinary investors have not achieved positive returns this year.

XRP’s Independent Market

Amid market gloom, XRP and Solana funds have become among the few bright spots, with inflows of $70 million and $7.5 million respectively. Notably, Franklin D. Templeton’s XRP ETF launched at the end of November contributed $28.6 million in inflows.

Looking at the longer timeline, since mid-October, spot XRP products have attracted approximately $1.07 billion in net inflows. Since the launch of XRP and Solana ETFs, Bitcoin products have lost about $2.8 billion, Ethereum products about $1.6 billion, while XRP has become a recipient of fresh capital.

Institutional Endorsement

Institutional capital favoring XRP is key to its independent market performance. Since its official launch in November, the XRP ETF has not experienced a single day of net outflows. This stands in stark contrast to other mainstream crypto ETFs. The successful listing of these ETFs itself signals strong regulatory approval. Traditional financial giants like Franklin Templeton and Grayscale have products approved by NYSE Arca, providing a legitimate, regulated entry channel for pension funds or hedge funds and other institutional investors.

Vanguard reversed its stance in early December, opening spot crypto ETF trading, which market analysts interpret as a key signal of institutional shift from opposition to adoption, likely bringing more traditional investors into this asset class.

On-Chain Activity

While XRP’s price performance appears weak, the activity on its underlying network, XRP Ledger (XRPL), tells a different story. Data shows that the real-world asset tokenization on XRPL has grown by about 17%, and the market cap of stablecoins related to XRPL activity has increased by approximately 29.5%.

The network maintains around 900,000 daily transactions, repeatedly surpassing 1 million, with payment volumes often reaching hundreds of millions or even over 1 billion XRP. This indicates that even if the token price is under pressure, XRPL’s infrastructure-level applications remain strong and stable, reflecting high throughput and active demand.

Technical Analysis and Price Forecast

As of December 30, XRP’s price fluctuated within a narrow range of $1.86 to $1.91, failing to break through the psychological barrier of $2.00. Technical charts show XRP trading below all key moving averages, confirming a current downtrend. The first critical support zone is between $1.80 and $1.85; a decisive break below could open the downside toward the mid-$1.60s.

Initial resistance on the upside is between $2.00 and $2.10, where psychological and moving average pressures converge. Analysts believe XRP needs to close above $2.05 on a daily basis to signal a potential end to the downtrend.

Global Market Divergence

Geographically, market flows also show clear divergence. Due to major Bitcoin and Ethereum ETPs listed in the US, the US market again led global outflows, totaling $460 million. Switzerland experienced outflows of $14 million, ranking second. Conversely, Germany stood out as an exception, attracting $35.7 million in inflows last week. CoinShares notes that German investors seem to be taking advantage of recent price weakness to accumulate positions.

Potential Bullish Signals

Despite current price and technical challenges, XRP’s fundamental outlook is undergoing structural change. Continued strong ETF capital inflows are creating a new institutional demand floor for XRP. Several institutions, including 21Shares, ProShares, and CoinShares, are expected to launch their own XRP ETF products in the future. This could further diversify liquidity and create concentrated buying pressure in the spot market.

XRP’s future remains defined by a key dividing line: on one side, the clear downtrend and resistance at $2.00 on the price chart; on the other, the busy on-chain settlement data and persistent ETF buying records. On the Gate exchange, XRP’s price has fallen nearly 49% from its all-time high of $3.65 in July. Institutional investors are quietly accumulating at discounts on German exchanges, while spot sell orders on exchanges surge like a tide.