Is XRP Supply Dwindling? Here’s What It Means for Retail Investors

• XRP supply tightens as large holders accumulate and ODL transactions increase.
• Falling foreign exchange reserves and bullish sentiment suggest potential for higher prices.

Ripple (XRP) Supply is reportedly decreasing as large amounts are being channeled through Ripple’s On-Demand Liquidity (ODL) corridors.

At the same time, large holders, or “whales,” continue to accumulate, creating rapid consolidation of XRP by institutional players.

This accumulation reduces the supply available to retail investors, creating a sense of urgency for those wishing to enter the market.

As the window for retail participation narrows, a pressing question remains: Will this scarcity drive XRP prices higher or lead to market volatility?

Are active addresses and transactions increasing?

The XRP Ledger is showing signs of increasing network activity. At press time, the number of active addresses had increased by 0.97%, reaching 9,339,000.

Similarly, the number of transactions is also on the rise, with an increase of 0.98%, bringing the total to 1.6345 million transactions, according to CryptoQuant Data.

This surge indicates greater participation and higher transaction volumes, suggesting that whales are moving XRP at a rapid pace. With increased transaction and address activity, the market could be positioning itself for a supply-driven price rally.

How Does XRP Exchange Supply Shape Market Sentiment?

XRP exchange supply continues to decline, with reserves decreasing by 0.26% over the past week to 2.977 billion XRP. Lower exchange supply typically signals increasing demand and fewer tokens available for trading, which could lead to upward pressure on prices.

Retail traders face an increasingly competitive landscape as large holders continue to absorb supply.

What does XRP liquidation data reveal?

XRP liquidation data further supports the idea of ​​a supply crunch. As of September 21, 2024, long liquidations totaled $49.78k, far outpacing short liquidations at $2.97k. This indicates bullish sentiment among traders betting on a price rally.

However, the XRP market could see sharp price fluctuations with supply decreasing and long positions increasing.

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Read XRP Price Prediction 2024-2025

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Will Scarcity Drive XRP Price Rise?

The rapid accumulation of XRP by whales and its increasing use in ODL corridors leaves retail investors with fewer opportunities to obtain tokens. With the increase in active addresses and transaction counts, as well as the decrease in supply on exchanges, market conditions seem ripe for a potential price rally.

However, XRP’s scarcity could also create volatility, making it essential for retail investors to act quickly.