XRP, the cryptocurrency that has seen its fair share of volatility, appears to be staging a comeback. After hitting a 15-month low of $1.12 on February 6, XRP has recovered to a high of $1.67, a 50% increase. While the current price remains more than 60% below its multi-year high of $3.66, several key metrics suggest that the $1.12 mark could be the new bottom, setting the stage for a sustained recovery.
XRP Supply on Exchanges Drops to Five-Year Low
Data from Glassnode reveals a significant decline in the XRP supply held on exchanges, which has fallen to 12.9 billion XRP, a level last seen in May 2021. This trend indicates that holders are moving their tokens to self-custody, possibly signaling reduced selling pressure and a bullish outlook for the future.
“The decline in XRP supply on exchanges suggests a lack of intention to sell by holders, which could reinforce the upside potential for XRP,” explained CryptoQuant contributor PelinayPA. Binance’s XRP reserve has also dropped sharply to around 2.57 billion XRP, with both the 50-day and 100-day simple moving averages (SMA) sloping downward, further supporting the bullish thesis.
Funding Rates Reach Extreme Lows
Binance funding rates for XRP fell to -0.028% on February 6, the lowest level since April 2025. Combined with the falling spot prices, these negative funding rates reflect overcrowded short positions and capitulation among leveraged longs. Historically, such extreme negative funding rates have often signaled a potential bottom or short squeeze.
“Extreme negative funding rates typically precede a market reversal, as shorts are forced to cover their positions,” noted PelinayPA. This pattern was evident in April 2025, when a 65% rally to $2.65 followed a similar funding rate setup. The current decrease in XRP futures open interest, down 55% from its peak in early January, suggests that leverage traders are reducing their exposure, potentially setting the stage for a price reversal if buying pressure returns.
Spot Taker CVD Flips Positive, Indicating Strong Buyer Demand
The 90-day spot taker cumulative volume delta (CVD) for XRP, which measures the difference between buy and sell volume over a three-month period, has turned positive. This shift indicates a rebound in demand, with buyers regaining control. If the CVD remains positive, it could signal that buyers are stepping in at lower levels, potentially driving the price higher.
“A positive CVD suggests that buyers are becoming more active, which is a strong indicator of a potential price recovery,” said a market analyst at CryptoQuant. This metric has historically been a reliable predictor of upward price movements, further bolstering the bullish case for XRP.
Steady ETF Inflows Signal Institutional Confidence
Despite the recent price drop, US-based spot XRP exchange-traded funds (ETFs) continue to attract investor interest. These investment products have recorded inflows 53 days out of 59 since their launch in November 2025, underscoring persistent institutional demand. On February 17, spot XRP ETFs added $4.5 million, bringing cumulative inflows to $1.23 billion and total net assets under management to over $1.01 billion.
“The steady inflows into XRP ETFs, even during a market downturn, indicate strong institutional confidence in the asset,” commented a financial analyst at SoSoValue. This trend is particularly noteworthy as global crypto investment products logged the fourth week of outflows totaling $173 million, with XRP ETPs emerging as the top performer with inflows of $33.4 million during the week ending February 13.
While the road to recovery may not be smooth, the combination of reduced supply on exchanges, extreme funding rates, positive CVD, and steady ETF inflows paints a bullish picture for XRP. As the market continues to digest these signals, the stage is set for a potential sustained rally, with the $1.12 level likely marking a significant bottom.
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