$1.13 Billion Flows into XRP ETFs: Why is the Price Stagnating?

Despite substantial capital inflows into XRP exchange-traded funds (ETFs), the price of XRP continues to face challenges in gaining traction.

Key Takeaways

Five spot XRP ETFs launched on November 13 have attracted $1.13 billion in net inflows.
Franklin Templeton’s ETF has surpassed 100 million XRP in holdings.
XRP’s price remains under pressure, trading at $1.84, down 1.68% in the last day.
High levels of negative social media sentiment could indicate potential for future price increases.

XRP is about to explode

XRP ETFs Make a Mark

Following a series of legal challenges, Ripple’s XRP has finally carved its niche on Wall Street. Since the launch of five spot XRP ETFs from companies like Canary, 21Shares, Grayscale, Bitwise, and Franklin Templeton on November 13, these funds have seen an impressive surge in demand. According to data from SoSoValue, by December 23, the total assets of these funds reached $1.125 billion, fed by $1.13 billion in net inflows.

XRP price action

Consistent Growth of XRP ETFs

In contrast to the overall crypto market's volatility, XRP spot ETFs have shown remarkable consistency. These funds have recorded daily net inflows since their inception, achieving a remarkable streak of 33 consecutive days. This strong performance sets XRP apart from leading cryptocurrencies like Bitcoin and Ethereum, which have faced periods of significant outflows during the same timeframe.

Franklin Templeton Reaches Major Milestone

Franklin Templeton has emerged as a significant player in driving this momentum. Their XRP spot ETF recently crossed a crucial benchmark, surpassing 100 million XRP in total holdings. As of December 22, the fund possessed approximately 101.55 million XRP, equating to about $192.7 million. This substantial backing sends a strong signal to institutional investors that XRP is now a safe investment option, despite its previous legal hurdles.

The Price Conundrum

Despite the robust buying activity from ETF providers, XRP's price has struggled to gain upward momentum. As of this writing, XRP is trading at $1.84, reflecting a decline of approximately 1.68% over the past 24 hours and a significant drop of 10.55% over the past month. However, some traders maintain a more optimistic outlook.

Recent analysis from Santiment reveals that negative social media sentiment surrounding XRP has reached notably high levels. Interestingly, periods characterized by high “FUD” (Fear, Uncertainty, and Doubt) often precede bullish trends. Historically, when sentiment is at its lowest, XRP has frequently surprised the market with sudden price rallies. With ongoing positive inflows, many analysts interpret the current price drop as a coiled spring, ready to release upward momentum when the market conditions are favorable.

According to Santiment, “XRP is seeing far more negative social media commentary than average. Historically, this setup leads to price rises. When retail has doubts about a coin’s ability to rise, the rise becomes significantly more likely.”

Final Thoughts

In conclusion, while XRP faces challenges in terms of price stability, the significant inflow of capital into its ETFs and the strong institutional support signal a potential for future growth. Investors and traders are closely monitoring these developments, as they could set the stage for a bullish turnaround in XRP's price.