XRP Exchange Supply Hits 8-Year Low

The amount of XRP held on cryptocurrency exchanges has dropped to approximately 1.6 billion tokens - the lowest level in eight years - as ETF demand and long-term holding behavior accelerate a potential supply squeeze.

Key Statistics

-1.6 billion XRP on exchanges (8-year low)
-Down from 3.76 billion XRP in October 2025
-57% decline in exchange-held supply in ~3 months
-760+ million XRP now locked in ETF custody

What's Driving the Decline

Multiple factors are contributing to the historic decline in exchange-held XRP:

1.ETF Custody: Spot XRP ETFs have absorbed over 760 million tokens into institutional custody since their November launch.
2.Long-term Holding: Investors are moving XRP to private wallets, signaling no intent to sell at current prices.
3.Ripple Escrow: On January 1, Ripple re-locked 700 million XRP into escrow, maintaining supply discipline.

Supply Shock Potential

The declining exchange inventory creates conditions for amplified price moves when demand picks up. With less liquid supply available for trading, even modest increases in buying pressure could result in outsized price movements. However, analysts caution that the $2 level has proven to be strong resistance, with sellers consistently appearing at that price point.

Historical Context

The last time XRP exchange supply was this low was in early 2018, during the aftermath of XRP's previous all-time high run. However, the current situation differs fundamentally: rather than post-peak exhaustion, this decline reflects growing institutional adoption through regulated ETF products and increased confidence in XRP's long-term utility.

What This Means

While reduced exchange supply is structurally bullish over the medium term, price action will ultimately depend on demand catalysts. Potential triggers include the Market Structure Bill markup on January 15, continued ETF inflows, and broader crypto market sentiment. The combination of tightening supply and persistent institutional demand sets up favorable conditions for 2026.