Why $XRP Sharp Exchange Supply Drop Could Open the Door to $4–$5

One of the most important signals for XRP in 2026 isn’t coming from price charts alone it’s coming from exchange supply. Over the past year, the amount of XRP held on trading platforms has fallen dramatically, from roughly 4 billion tokens to nearly 1.5 billion. That’s a decline of about 57%, and it changes the entire supply dynamic.

When coins leave exchanges, it usually means one thing: they are no longer positioned for quick selling. Instead, XRP is moving into long-term wallets and institutional custody. This reduces the amount of liquid supply available to absorb buying pressure. In simple terms, the thinner the supply on exchanges, the easier it becomes for price to move sharply when demand increases.

This shift is happening alongside growing institutional exposure. Since their launch in late 2025, spot XRP ETFs have absorbed an estimated 750 million XRP, supported by around $1.37 billion in inflows. Firms such as Canary Capital, Bitwise, and Franklin Templeton are behind these products, steadily removing XRP from the open market and locking it into long-term vehicles.

On-chain data adds more clarity. Metrics from Glassnode and CryptoQuant suggest this is not panic-driven selling. Instead, it resembles accumulation. Major exchanges, including Binance, have seen XRP reserves trend lower, while large custody wallets linked to institutions continue to grow. Some regions, such as Korea, have also recorded notable XRP withdrawals, further tightening available supply.

The implication is straightforward. With fewer coins available to trade, price reactions can become more aggressive. Moves that once produced small gains can now result in double-digit percentage rallies over short periods. This is why many analysts believe XRP may be structurally positioned for a stronger expansion phase, with upside potential extending toward the $4–$5 range rather than stalling below prior resistance levels.

#ETHMarketWatch #USIranMarketImpact #GrayscaleBNBETFFiling #xrp