A significant withdrawal of XRP from Binance has caused the platform’s reserves to fall to one of the lowest levels recorded. This ongoing outflow of tokens from a major trading platform is resulting in what analysts describe as a supply shock, where decreasing exchange supply coincides with increasing institutional demand.

The Great XRP Exodus

Data from Binance shows a persistent trend. Since October 6, around 300 million XRP have departed from the exchange, lowering total reserves to about 2.7 billion tokens, a rarely seen level. As noted by on-chain analyst Darkfost, this trend is interpreted as positive, suggesting that investors are opting to secure their assets in private wallets rather than keeping them on exchanges for immediate trading.

This behavior indicates a strengthened resolve among holders to keep their assets for the medium to long term. The removal of such a substantial volume of tokens from exchanges leads directly to a decline in the availability of coins for trading, setting a foundation for potential price increases if buyer demand rapidly escalates, as there will be less supply on the market to satisfy new orders.

Recent findings from Arab Chain confirm this sentiment, revealing that the ratio of XRP on exchanges to its total supply has dropped to its lowest this year.

Market Sentiment and Price Performance

While reserve data paints a picture of accumulation, the actual price performance tells a more complex story. Currently, XRP is trading around $2.19, showing minimal change in the last 24 hours. Nevertheless, it has increased by approximately 3.5% over the past week but has seen a decline of over 12% in value over the past two weeks, with even worse performance in the preceding month, having dipped by 17%.

This divergence presents a notable inconsistency: despite the price struggles, many investors continue to withdraw their coins, signaling their confidence in the long-term value.

Further complicating the market metrics, a recent report by CryptoQuant highlighted that open interest for XRP futures on Binance has plummeted to its lowest in a year, indicating a reduction in speculative trading activity. Additionally, despite the recent launch of several spot XRP ETFs in mid-November, data suggests that large holders, or “whales,” have sold over 180 million tokens, exerting additional selling pressure.

For technical analysts, a crucial level to observe is $2.00. According to analysts like Ali Martinez, maintaining a position above this threshold is vital for the potential bullish trend, with a drop below it signaling further declines.