Recent on-chain data has highlighted a major shift in XRP holder behavior. According to crypto analyst Diana (@InvestWithD), the amount of XRP held on centralized exchanges has declined to levels not seen in several years.
Data sourced from Glassnode shows a steady reduction in exchange-held XRP across multiple market cycles. Despite price fluctuations within a defined range, XRP balances on trading platforms have continued to trend lower, suggesting that many holders are moving their assets into self-custody wallets.
👉 What This Means for Supply
A declining exchange balance typically signals reduced immediate selling pressure. When fewer tokens are available on exchanges, the liquid supply tightens, which can become significant if market demand increases. This trend often reflects stronger conviction among long-term holders rather than short-term speculation.
👉 Community Views and Counterarguments
Some community members have pushed back on this interpretation, pointing to XRP’s monthly escrow releases. With around 1 billion XRP unlocked each month, critics argue that overall supply remains ample and that exchange balance data alone does not confirm scarcity.
Others have noted that despite shrinking exchange reserves, XRP price action has faced downside pressure, suggesting that on-chain metrics must be evaluated alongside broader market sentiment.
👉 Final Take
While declining exchange balances do not tell the full supply story, they offer valuable insight into how XRP holders are positioning themselves. As XRP continues to trade amid changing market conditions, the interaction between escrow unlocks, holder behavior, and exchange liquidity will remain key factors to watch.
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