Headline: Institutional Demand for XRP Remains Strong as On‑Chain Liquidity Paints a Mixed Short‑Term Picture
Institutional interest in Ripple (XRP) stayed unusually high in February — AMBCrypto reports that Grayscale’s Head of Product and Research, Rayhaneh Sharif‑Askary, identified XRP as the second‑most inquired asset among advisory clients. Yet on‑chain and market data show a complex setup: strong short‑term buying signals coexist with persistent long‑term selling pressure.
Price and technical snapshot
- After peaking at $2.41 in the first week of January, XRP has lost roughly 41.35% over 45 days.
- The H4 swing structure has recently flipped bullish, and the $1.41 retracement level was tested and held as support.
- A relief rally past $1.55 is possible in the near term, but the broader trend remains bearish.
- Some analysts point to exchange reserve accumulation on Upbit and have flagged a potential target around $0.80 later this year.
What the on‑chain data says
CryptoQuant analyst “The Alchemist,” writing for CryptoQuant Insights, emphasized liquidity dynamics as a key factor behind recent price behavior:
- USD liquidity (the depth of capital backing XRP markets) expanded significantly during the November 2024 rally, helping sustain price gains. Liquidity in AMM pools isn’t the underlying cause of rallies, but it does reflect market conviction and helps prolong moves.
- In recent weeks liquidity has compressed, increasing sensitivity to volatility. Reduced token‑side availability observed late in 2024 can be read as “reduced active supply,” but it may also reflect AMMs being forced to sell XRP into stablecoins during the aggressive rally.
- Lower XRP liquidity makes it easier for large buy orders to push prices higher — meaning the current compression could simply be an aftereffect of past volatility rather than a clear signal of another imminent upswing.
Derivatives and flow indicators
- Open Interest has continued to decline, indicating weak speculative participation; that persistence suggests the broader bearish trend has not yet reversed. Traders often look for rising Open Interest to confirm a bullish sentiment shift.
- The 7‑day moving average of the Taker Buy/Sell Ratio climbed to 1.01 on Feb. 17 — a rare occurrence for XRP that was previously seen during the early January rally. Rising taker buy volume combined with compressed liquidity supports a short‑term bullish bias.
Bottom line
XRP’s landscape is nuanced: institutional demand is strong, and short‑term technical and flow indicators hint at possible relief upside, but declining Open Interest and continued selling pressure keep the longer‑term outlook cautious. Traders should monitor liquidity metrics, taker activity and Open Interest for clearer directional confirmation.
Disclaimer: This article summarizes market commentary and on‑chain data for information only and is not investment advice. Cryptocurrency trading carries high risk; always do your own research before making financial decisions.
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