The recent surge in XRP’s price has created massive paper gains for early investors, but a growing wave of profit-taking could signal turbulence ahead. Data reveals that the most successful XRP holders—those who bought before the November 2024 rally—are now selling off their holdings at an average pace of $68.5 million per day, raising concerns about market stability and potential downside pressure.
This trend mirrors behavior seen during the lead-up to the 2017 market top, when euphoric price action was followed by a brutal 90% correction. With over 70% of XRP’s realized market cap formed in late 2024 and early 2025, the current investor base is increasingly concentrated among newer, more vulnerable holders. If selling continues, analysts warn of a possible 35% decline toward the $1.35–$1.60 range.
Who’s Selling? Early XRP Investors Cash In
The largest beneficiaries of XRP’s rally are investors who entered the market when prices were below $0.50. These early adopters have seen returns exceeding **300%**, and they’re now actively realizing profits as prices approach $2.14.
According to Glassnode data, the 7-day average of realized profits from holders with gains over 300% stands at $68.8 million daily. This sustained profit-taking reflects a classic distribution phase—where smart money exits positions after a significant run-up.
"When the biggest winners start cashing out en masse, it often marks a turning point in the cycle." — On-chain analyst
Such behavior isn’t inherently bearish, but when concentrated across a narrow group of high-margin holders, it increases market fragility. The timing is particularly notable given historical parallels to 2017, when similar profit spikes preceded a dramatic collapse.
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A Top-Heavy Market Structure Emerges
One of the most concerning on-chain developments is the formation of 70% of XRP’s realized cap between late 2024 and early 2025. The realized cap measures the total value of all coins based on their last movement price, offering insight into where investors originally entered.
This concentration means that the majority of XRP in circulation today was acquired during or just after the November rally—when momentum was peaking. As a result, the market structure has become “top-heavy,” with newer holders holding large positions at elevated prices.
Historically, such structures are prone to sharp corrections because:
- Newer investors lack deep cost basis cushions.
- Fear of loss amplifies selling during pullbacks.
- Liquidity tends to dry up once early sellers exit.
Without a broad base of long-term, low-cost holders to absorb selling pressure, any negative catalyst could trigger a cascade of stop-losses and panic selling.
SOPR and Realized Price: Warning Signs Flash
Two key metrics—SOPR (Spent Output Profit Ratio) and realized price by age cohort—are now flashing caution signals.
SOPR Decline Among Mid-Term Holders
SOPR measures whether spent coins are sold at a profit (>1) or loss (<1). For XRP holders who bought between 3 and 6 months ago (post-rally entrants), SOPR has been steadily declining since April, indicating increasing difficulty in selling at a profit.
Meanwhile, older cohorts (6m–12m) have stabilized or begun recovering, suggesting they’re not under immediate pressure. This divergence highlights that recent buyers are now underwater or barely breaking even, making them more likely to sell at the first sign of weakness.
Realized Price Points to Downside Risk
The average entry price for:
- 3m–6m holders: $2.28
- 6m–12m holders: $1.35
With XRP trading around $2.14, the newer cohort is already in slight loss territory. A drop below $2.00 could accelerate sell-offs as breakeven becomes unattainable.
Conversely, the 6m–12m group still has about a 35% downside buffer before reaching their average cost. However, if prices fall toward $1.35–$1.60, even this group may begin liquidating—potentially deepening the drawdown.
Technical Outlook: Bearish Pattern vs. Bullish Support
On the weekly chart, XRP is forming a descending triangle—a bearish reversal pattern typically seen after strong uptrends. This setup suggests accumulation is weakening and distribution is taking over.
The pattern’s measured move points to a downside target near $1.30, aligning closely with the realized price floor and the breakeven zone for longer-term holders.
However, there’s a bullish counter-narrative: a decisive bounce from the 50-week EMA (exponential moving average) could invalidate the bearish structure. Such a rebound would signal sustained demand and potentially re-energize the path toward $3 or higher.
Ultimately, price action near key support levels will determine whether this is a healthy consolidation or the start of a deeper correction.
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Frequently Asked Questions (FAQ)
What does “realized profit” mean in crypto?
Realized profit refers to gains locked in when coins are sold at a price higher than their last recorded movement price. It helps identify when large groups of investors are cashing out.
Why is SOPR important for XRP analysis?
SOPR shows whether coins being moved are generating profit or loss. A falling SOPR among recent buyers suggests weakening confidence and increased risk of capitulation.
What is a descending triangle, and why is it bearish?
A descending triangle forms when lower highs meet a flat support level. It indicates declining buying pressure and often precedes breakdowns, especially after extended rallies.
Could XRP still reach $3 despite these risks?
Yes—but only if it holds above critical support and regains momentum. A strong bounce off the 50-week EMA could reignite bullish sentiment and open room for further upside.
How much of XRP’s supply is controlled by recent buyers?
Over 70% of XRP’s realized market cap was established between late 2024 and early 2025, meaning most circulating supply was acquired during or after the rally began.
What would trigger a 35% drop in XRP price?
A combination of sustained profit-taking by early holders, continued losses among newer buyers, and breakdown below technical support around $2.00 could spark a cascade toward $1.35–$1.60.
Final Thoughts: Caution Amid Cyclical Patterns
XRP’s current phase bears an uncanny resemblance to its 2017 peak—both in terms of investor behavior and market structure. While the asset has delivered extraordinary returns to early believers, the tide may be turning.
With profit-taking accelerating and newer holders increasingly vulnerable, the path forward looks uncertain. A retest of $1.35–$1.60 is not only possible—it’s supported by on-chain fundamentals and technical indicators.
That said, crypto markets are inherently volatile and prone to surprises. Monitoring realized profit flows, SOPR trends, and key moving averages will be essential in navigating what comes next.
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