New Bottom for XRP Supply on Exchanges - What's Next for Price?

XRP has gone through a rough patch, mainly due to ongoing legal issues with the US Securities and Exchange Commission (SEC).

These challenges have been compounded by the current market crisis, which has led to a decline in XRP to $0.4734 after falling 12% in the past month.

XRP supply on exchanges has hit its lowest level since January

While the broader crypto market has shown some bullish trends this year, XRP has not benefited in a similar way. Instead, the cryptocurrency has seen a 23% year-to-date decline. Additionally, the supply of XRP on exchanges has decreased by 1%, now standing at 2.84 million XRP, which equates to $1.34 million. This marks the lowest supply on exchanges since January 1, signaling growing investor disillusionment with the token.

Several factors can contribute to a drop in supply:

• Investors' shift to proprietary hardware wallets: Many investors prefer to keep their XRP in personal hardware wallets for security reasons.
• Retention Expectations: It is possible for investors to hold their XRP in anticipation of higher future profits.
• Staking: Some investors may be staking their XRP in various DeFi protocols, reducing the liquidity supply of exchanges.

Over the past 11 days, investors have lost over $30 million with their XRP holdings. This loss is indicative of a market capitulation, where investors sell their assets at a loss during a market downturn.

In addition, network activity decreases, resulting in reduced trading volume. XRP trading volume currently stands at $870 million, down 19%.

Potential future price movements

Given the current price pattern, the price of XRP may continue to decline, potentially reaching:

• $0.45: A likely next target if the current downtrend continues.
• $0.41: A further decline to this level is possible, a price point last seen on April 7.

Conversely, if XRP manages to rise to:

• $0.49: This can act as a bullish trigger.
• $0.51 or above: Reaching $0.49 could pave the way for further gains, leading to a price of $0.51 or above.