XRP Price Prediction as ETF Inflows Fade and RLUSD Supply Drops

Key Insights

• XRP price has dropped from last year’s high of $3.6 to $1.3260.
• Demand for the spot XRP ETFs has waned in the past few months.
• The token has formed a bearish pennant pattern, pointing to more downside.

XRP price has recoiled, with its returns mirroring that of other top cryptocurrencies like Bitcoin and Ethereum. Ripple token was trading at $1.3265 on Sunday, a big drop from last year’s high of $3.6. It may come under more pressure as XRP ETF demand wanes and the supply of Ripple USD (RLUSD) declines.

XRP ETF Demand Has Waned This Year

Data shows that American investors are no longer buying spot XRP ETFs as they did a few months ago.

When these funds were launched in November, they attracted over $666 million in inflows in their first months. They then attracted over $499 million in inflows in the following month.

This growth has largely stalled, with the funds attracting just $10 million this month so far. Worse, they lost $31 million in assets last month. It was the first month that these funds suffered outflows since their launch.

Bitwise still holds the biggest XRP ETF in the world with over $276 million in assets, followed by Canary’s XRPC, which has $267 million.

The ongoing decline in demand for spot XRP ETFs is largely due to the broader crypto market crash, which has affected Bitcoin and most altcoins. Most tokens remain in a bear market after falling by double digits from their all-time highs.

RLUSD Growth Has Stagnated

The ongoing XRP ETF weakness stems largely from weakness in its ecosystem. A good example of this is the performance of Ripple USD (RLUSD) stablecoin, which has stalled in the past few months.

Data shows that the stablecoin has a market capitalization of about $1.4 billion, down substantially from the all-time high of over $1.6 trillion. This slowdown has occurred even as other stablecoins have continued to grow this year.

Circle’s USDC has added over $10 billion in the last 30 days to over $80 billion. Tether’s USDT has $184 billion in assets, while PayPal’s PYUSD holds $4 billion in assets.

RLUSD’s usage has struggled in the past few months. Data shows that the stablecoin’s volume totaled $9.1 billion over the last 30 days. In contrast, USDC had $7 trillion in volume, while USDT had $1.2 trillion.

RLUSD’s growth has stalled despite the major initiatives Ripple Labs has undertaken, including the launch of Ripple Prime, a payment platform created following the acquisition of Hidden Road in a $1.2 billion deal.

The company has also launched additional solutions to boost its utility, including entering the corporate treasury industry through the acquisition of GTreasury. All these initiatives are meant to create more utility for the XRP and RLUSD tokens.

More data shows that the XRP Ledger network is no longer growing and is now being beaten by newer chains. For example, according to DeFi Llama, its DEX volume over the last 30 days stood at $125 million, well below Solana’s $50 billion and Ethereum’s $35 billion. Off Chain handled $5.86 billion, while Monad and Fuel Ignition had $1.54 billion and $518 million.

XRP Price Prediction: Technical Analysis

Ripple price has formed a series of lower lows and lower highs since peaking at $3.6 on July 18 last year. It has dropped below the 61.8% Fibonacci Retracement level at $1.6715.

The token has remained below the descending trendline, which connects the highest swings since July last year. It has dropped below moving averages and is now in the process of forming a bearish pennant pattern.

The token’s Relative Strength Index (RSI) has remained below the neutral point at 50.

Therefore, there is a risk that it may continue falling, potentially the year-to-date low of $1.1175. A drop below that level will point to more downside, potentially to the key psychological level at $1.00.

The bearish XRP price forecast will become invalid if it moves above the descending trendline. If this happens, the token will rise to the psychological level of $2.0.

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