The price of XRP has continued to decline and trade sideways, impacting the price of the US spot ETFs that provide exposure to the altcoin. Canary Capital’s XRP fund has fallen 20% since launch, although this fund is still the largest by assets under management (AuM).
XRP’s sideways price action leads to an ETF crash
The XRP price continued to trade within a tight range, just above the psychological level of $2, leading to bearish sentiment among investors. The altcoin has fallen more than 10% in the past month, around the time of the first spot XRP ETFCanary’s fund, launched. Notably, this bearish price action contributed to a price crash for Canary’s XRPC fund.
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TradingView data shows that Canary’s XRP ETF is down 20% since its launch on November 13. XRPC also fell nearly 10% last week amid choppy price action. The Canary fund also likely crashed due to increased competition from three other spot funds launched afterward. This has led to a slowdown in inflows since the launch of these funds.
Meanwhile, these funds track the spot price of XRP, which also explains Canary’s XRPC crash. XRP mirrors Bitcoin’s price action amid concerns the crypto market may already be in a predicament bear market. XRP whales also appear to be bearish at the moment Santiment data shows a decline in whale transactions from the recent high in November.
However, despite this bearish sentiment, while the crypto market is currently in a state of fear, the XRP ETFs have continued to record daily net inflows. SoSo value data show that these funds have had a 16-day net inflow since Canary’s XRP fund launched on November 13, and have yet to record a net outflow day.
Canary’s XRP ETF, which has suffered a 20% price crash, is currently the largest spot XRP fund with $364 million in assets under management. Grayscale’s GXRP is in second place with $211 million, while Bitwise and Franklin Templeton are third and fourth. As a group, these XRP funds are about to reach $1 billion in assets under management, with $861 million in total net assets.
Some positives for the Altcoin
Santiment data show that the outflows from XRP exchanges have exceeded the inflows in recent times. This is positive because it indicates that more investors are accumulating than selling. Currency outflow typically represent moves for long-term investing, especially in anticipation of higher prices.
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In one X messageSantiment said the XRP Ledger is seeing a fascinating trend where whale and shark wallets are shrinking in number but continuing to grow in the number of coins held. The on-chain analytics platform noted that there are 20.6% fewer 100 million XRP walletsbut that these wallets as a group still hold the highest number of 48 billion coins in seven years. As such, the existing 100 million XRP wallets double their accumulation efforts and offset the shrinking number of wallets.
At the time of writing, the altcoin’s price is trading around $2.07, up in the past 24 hours, according to facts from CoinMarketCap.
Featured image from Freepik, chart from Tradingview.com