XRP is quietly forming a “spring-loaded” supply setup that frustrated retail traders are completely ignoring

XRP is ending 2025 with one of the most paradoxical profiles in the crypto market, thanks to record-breaking institutional inflows colliding with one of the weakest price charts.

According to CoinShares data, XRP investment products attracted approximately $70.2 million in net new money in the final trading week of December. This pushed its monthly inflow to more than $424 million, making it the best-performing crypto investment product for the month.

During the month, Bitcoin products recorded $25 million in outflows, while Ethereum funds shed $241 million.

Yet, the spot tape tells a sharply different story.

According to CryptoSlate's data, XRP traded near $1.87 as of press time, cementing a 15% decline for the month and languishing at the bottom of the performance table for the 10 largest crypto assets.

That split between record appetite for regulated “wrappers” and a sagging spot price suggests a market that is quietly changing hands, shifting from retail momentum traders to model-driven institutional allocators.

ETF flows

The divergence has been building throughout the fourth quarter but accelerated significantly in the holiday-shortened weeks of December.

Since mid-October, when US-listed spot XRP products began trading, the category has attracted more than $1 billion in net inflows, according to product disclosures and exchange data.

This steady demand has contrasted sharply with the choppy, volatile flows seen in older crypto ETPs, where profit-taking and year-end de-risking have been recurring themes.

While Bitcoin ETF holders have been rotating capital to harvest tax losses, buyers of XRP products appear to be executing a different mandate entirely.

The Canary XRP ETF (XRPC) has emerged as the bellwether for this new trade. The fund has gathered more than $300 million in assets since its launch and set a 2025 record for first-day trading volume among US ETFs, according to SoSo Value data.

The scale of the fund is critical; it provides wealth managers and model-portfolio providers with a liquid, defensible vehicle that fits seamlessly into standard brokerage and custody workflows—a prerequisite for adding any asset to client line-ups.

Flows of this nature are typically driven less by traders attempting to time the market and more by process. Advisory platforms, multi-asset funds, and wealth management networks tend to move only after a product has been listed, established a track record, and demonstrated that spreads are acceptable.

Once those internal approvals are granted, allocations are often hard-coded into portfolio models and rebalancing rules.

This mechanical bid helps explain how XRP ETPs could continue to absorb capital even as the token’s price drifted lower and social sentiment turned toxic.

While retail and leveraged traders sold into year-end fatigue, the buyers on the other side of the trade were filling strategic quotas rather than chasing a breakout.

Ripple’s broader infrastructure bet

Meanwhile, some investors have also linked the renewed interest in XRP vehicles to a larger, structural bet on Ripple’s corporate strategy.

The company spent 2025 pushing aggressively into traditional financial infrastructure, announcing landmark deals to acquire prime broker Hidden Road and treasury-management firm GTreasury, alongside the rollout of its RLUSD dollar-backed stablecoin.

These transactions, when fully integrated, would give Ripple a combined footprint spanning payments, custody, prime brokerage, and corporate treasury software.

Hidden Road, for instance, clears trillions of dollars in trades annually for hundreds of institutional clients, while GTreasury serves more than 1,000 corporate customers globally.

Supporters of the “full stack” thesis argue that these moves transform Ripple from a payments company into a vertically integrated provider of digital-asset plumbing for banks and hedge funds.

In this framing, XRP’s ETP flows are a proxy for participation in that infrastructure story. Buyers are not just speculating on a token; they are gaining exposure, via a regulated vehicle, to a network they expect to underpin the next generation of collateral and liquidity management.

XRP's sentiment

However, the mechanical impact of the inflows is most visible in the “float,” the supply of tokens available for active trading.

When an ETF or ETP issues new shares to meet demand, authorized participants must source XRP and deliver it to a custodian. As long as those shares remain outstanding, the underlying tokens sit in cold storage rather than on exchange order books.

This does not permanently remove supply, redemptions can push it back into the tradable pool, but it reduces the amount available to trade in the near term. On-chain and exchange data suggest that XRP balances held on centralized venues have been trending lower into year-end, even as fund holdings grow.

This creates a “spring-loaded” market structure. If discretionary trading volume picks up in January, or if a macro catalyst triggers a broader risk-on move, new buyers could find themselves competing over a significantly thinner layer of readily available supply.

In that scenario, small increases in demand can move the price more violently than they would have earlier in the year when float was abundant.

At the same time, sentiment around XRP in public forums has deteriorated to levels rarely seen outside of bear markets.

Analytics firm Santiment reports that negative commentary on the token has significantly outweighed positive mentions in recent weeks, reflecting retail frustration with its underperformance versus newer, more volatile tokens.

In past market cycles, such extremes in sentiment have sometimes preceded sharp contrarian rebounds, though the relationship is far from reliable.

Taken together, the picture is of a market in transition rather than consensus.

The flow sheet looks constructive: new money, new wrappers, and a growing share of supply held by funds that rebalance on calendars instead of tweets. The price chart, however, looks damaged, and the social tone is deeply skeptical.

For XRP heading into 2026, the widening gap between how it trades and where the capital is sitting may matter more than any single week of performance.

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