XRP On-Chain Activity Falls to Rare Lows — Here Is Why Some Analysts See a Potential Reversal

• XRP Ledger activity has dropped to some of its weakest levels in years, signaling reduced participation from both traders and investors.
• Spot buying has cooled since March, although exchange outflows suggest some investors continue accumulating off exchanges.
• Persistently negative funding rates may appear bearish, but similar conditions previously preceded a major XRP rally.

XRP’s network activity has slowed dramatically, and while that might sound like bad news at first glance, some analysts believe it could actually be laying the groundwork for a bigger move later this year.

Fresh data from Santiment shows both user activity and new wallet creation have fallen to unusually low levels. At the same time, derivatives traders remain overwhelmingly bearish, creating conditions that have historically preceded sharp reversals.

For now, though, the market is stuck waiting for a catalyst.

XRP Network Activity Falls to Multi-Year Lows

According to blockchain analytics platform Santiment, XRP Ledger activity has cooled significantly over the past several days.

On July 9 and July 10, the network recorded just 25,350 and 24,887 daily active addresses, respectively. Those were the second-lowest daily figures seen throughout 2026.

The slowdown wasn’t limited to existing users.

Daily network growth—which measures newly created addresses—fell to approximately 2,130, its weakest reading since November 2024.

Those numbers suggest traders aren’t rushing into the market despite XRP’s recent price stabilization. Instead, many appear content to wait for a stronger trend before committing fresh capital.

It’s a familiar pattern.

Rather than chasing short-lived rallies like those seen in April and June, investors seem to be waiting for confirmation that the next move has real momentum behind it.

Spot Buying Momentum Has Continued to Fade

Trading activity tells a similar story.

CryptoQuant’s 90-day Spot Cumulative Volume Delta (CVD) remains in neutral territory, indicating that neither buyers nor sellers have taken complete control of the market.

However, the broader trend has been pointing lower for several months.

Since March, aggressive buying pressure has gradually weakened. There was a brief burst of taker buying during May, helping XRP rebound toward $1.55, but the momentum faded almost as quickly as it arrived.

Eventually, prices slipped back toward the $1.10 area.

The data doesn’t necessarily point to aggressive selling—it points to a lack of conviction. Buyers simply haven’t returned in meaningful numbers.

Exchange Outflows Offer a Slightly More Positive Signal

Not every on-chain metric paints a bearish picture.

Data from Glassnode shows exchange net position change has remained negative for much of the past several months.

Generally speaking, negative exchange flows mean more XRP is leaving exchanges than entering them. That often suggests investors are moving coins into private wallets or cold storage rather than preparing to sell immediately.

Still, there’s an important distinction.

Current outflows are noticeably smaller than the large accumulation waves recorded during 2025. So while some investors continue withdrawing XRP from exchanges, the pace hasn’t been strong enough to indicate widespread accumulation just yet.

Bearish Funding Rates Could Become a Contrarian Signal

The derivatives market may be sending one of the more interesting signals.

According to CryptoQuant analyst Darkfost, XRP’s speculative positioning remains firmly tilted toward the bearish side.

The cryptocurrency’s 30-day aggregate funding rate has stayed negative throughout 2026, even after XRP corrected more than 70% from its July 2025 peak near $3.66.

Normally, persistently negative funding reflects a market where short sellers dominate sentiment.

Ironically, that isn’t always a bad thing.

Darkfost noted that a nearly identical setup developed during April 2025, when funding rates also remained deeply negative for an extended period. Shortly afterward, XRP surged roughly 126%, catching many bearish traders off guard.

That doesn’t mean history is destined to repeat itself.

But when bearish positioning becomes overly crowded, it can leave the market vulnerable to a powerful short squeeze if buying pressure suddenly returns.

XRP Still Needs One Critical Ingredient

For now, XRP presents a mixed picture.

Network activity remains subdued, spot buying has weakened considerably, and many traders continue betting against the asset through derivatives markets.

On the other hand, exchange outflows suggest at least some investors continue accumulating, while historically bearish funding rates have occasionally marked important turning points rather than prolonged declines.

The missing piece is demand.

Until spot buying strengthens and trading volume begins expanding again, XRP may continue drifting sideways as investors wait for a catalyst strong enough to break the market out of its current holding pattern.

If that catalyst eventually arrives, today’s extremely cautious sentiment could become the foundation for a much stronger recovery than many currently expect.