Key takeaways:
XRP exchange reserves surged by 1.2 billion tokens in a single day, led by Binance’s 610 million inflow.
Futures demand rose with CME open interest up 74%, but XRP underperformed peers despite the ETF optimism.
XRP (XRP) witnessed one of its most dramatic shifts in exchange reserves this month. On Sept. 1, Binance, Bithumb, Bybit and OKX exchange simultaneously reported a surge in their XRP holdings, totaling over 1.2 billion tokens in a single day.
Data from CryptoQuant indicated that Binance led the charge, expanding its XRP reserve to 3.538 billion from 2.928 billion, a massive 610 million increase. Bithumb wasn’t far behind, boosting its holdings to 2.519 billion from 1.647 billion XRP. Bybit nearly doubled its supply, jumping to 380 million from 188 million, while OKX reserves registered an astonishing increase to 233 million from only 112,000 XRP tokens.
Typically, rising exchange reserves are viewed as bearish, since they increase available supply and hint at potential selling. Yet, the timing of this surge complicates the picture. The inflows landed exactly at XRP’s critical support of $2.73, a level that has recently absorbed downside pressure.
Technical Indicators such as relative strength index (RSI) and MACD show easing sell pressure, suggesting that the sudden wave of inflows may not have been immediately market-facing. This raises the possibility of strategic positioning, either exchanges preparing liquidity for an upcoming event or large holders staging tokens for distribution.
Despite the increase in reserves, the altcoin’s price is on the rise, moving above $3 on Wednesday after a softer-than-expected US Producer Price Index (PPI) data, up 8.43% for the month.
Related: XRP flirts with $3 amid ETF approval hope: Is $3.60 the next stop?
XRP inflows ignite weekend surge, futures market shows mixed signals
XRP kicked off the weekend with sudden buy-side pressure that caught traders off guard. Crypto analyst Dom highlighted that a 3 million XRP market buy on Binance futures triggered a cascading move, adding more than 10 million XRP in net buy pressure within 15 minutes. Bulls sustained the momentum on Sunday, with Coinbase also reporting +8 million net XRP buys against relatively thin liquidity books.
Market commentator Char Steingraber noted that XRP’s return to the $3 level came on net inflows of $23.9 million against a backdrop of $6.9 billion in total trading volume. This meant just a 0.7% price increase on significant inflows, suggesting that while buying was aggressive, the market’s heavy liquidity dampened immediate upside.
Coinpectra also reported that institutional demand for XRP futures has grown, with open interest at CME surging 74% month-over-month to 386 million XRP. Meanwhile, broader futures demand climbed 5% to 2.69 billion XRP ($7.91 billion).
Despite the uptick, XRP monthly futures trade at a 7% premium to spot, signaling balanced leverage. Still, compared to other altcoins that gained double digits in August, XRP’s underperformance underscores a cautious outlook even as ETF speculation keeps sentiment alive.
Related: Bitcoin breaks $114K as cooling US PPI data boosts Fed rate cut bets
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.