Following a period of robust expansion within the prevailing cryptocurrency bull market, the XRP network is currently exhibiting indicators of deceleration.
This slowdown is underscored by on-chain metrics, which reveal a substantial 65% contraction in daily active addresses.
Specifically, the data reveals a significant drop from a high of 63,389 active addresses recorded on January 16, 2025, to a considerably lower figure of 22,859 by April 3rd.
This represents a considerable decrease in user interaction on the network.
This decline in network participation follows a period characterized by heightened speculative investment spanning from November 7, 2024, to mid-January 2025.
During this period, XRP experienced an extraordinary price appreciation exceeding 485%.
The optimistic market outlook at that time was predominantly fueled by investor anticipation that a presidency perceived as favorable to cryptocurrencies could positively impact Ripple and its associated ecosystem.
Daily active addresses experienced a dramatic surge
Increasing by over 432.6% within this timeframe
The subsequent market behavior exemplifies a scenario where short-term speculative enthusiasm outpaced underlying fundamental demand.
Realized capitalization experienced a substantial increase, escalating from $30.1 billion to $64.2 billion.
Data from Glassnode indicates that approximately $30 billion of this growth can be attributed to capital inflows within a mere six-month period.
This rapid influx of capital resulted in a concentration of wealth among newly established holders.
Currently, over 62.8% of XRP’s realized capitalization is held by investors who entered the market during this relatively brief window.
This sharp increase in new entrants raises concerns when considered in conjunction with the significant presence of retail investors.
Given their potentially elevated average purchase price, a considerable portion of these investors may be susceptible to downward price fluctuations.
As market enthusiasm diminished towards the end of February, indications of a receding speculative wave became apparent.
The Realized Profit/Loss ratio has exhibited a downward trend since January, signaling an increase in realized losses relative to profits.
This pattern often serves as an early indicator of eroding market confidence.
Coupled with the pronounced decrease in network activity, this suggests that many recent investors are now in a position of unrealized losses, thereby amplifying the potential for market instability driven by panic selling.
In recent trading sessions, XRP briefly dipped below the critical $2 psychological threshold amidst broader market anxieties triggered by President Donald Trump’s announcement of extensive global tariffs.
Nevertheless, the token has since demonstrated resilience, recovering by 5% within the day to reach a trading price of $2.13 at the time of this report.
