Cointelegraph has published new on-chain data showing a sharp contraction in XRP supply held on centralized exchanges. This shift may carry significant consequences for the asset’s future market structure. According to the data, XRP balances on exchanges have fallen to 1.6 billion tokens, the lowest level recorded in 7 years.
In October, that figure stood at 3.76 billion. The decline reflects a rapid and deliberate movement of tokens away from trading venues. This adds to the trend of shrinking supply on exchanges in 2025.
This change is notable because it has not shown up in the asset’s price trajectory. XRP has also not experienced a comparable selloff during this period. Instead, the chart shows the price holding relatively steady while exchange balances drop aggressively.
🔥 NOW: XRP supply on exchanges plunges to seven-year lows of 1.6 billion tokens, down from 3.76 billion in October. pic.twitter.com/arQTBSEgdu
— Cointelegraph (@Cointelegraph) December 31, 2025
What the Chart Signals About Holder Behavior
The chart uses Glassnode data to compare XRP’s price with total exchange balances using a 30-day moving average. The data suggests holders are choosing custody.
When tokens leave exchanges, they typically move into cold wallets, institutional storage, or long-term holdings. These tokens become harder to access for immediate sale. As a result, the liquid supply contracts even if the total circulating supply remains unchanged.
The speed of the move matters. Investors pulled more than 2 billion tokens from exchanges within a few months. That is not passive behavior. It shows intent and confidence among holders who appear unwilling to sell at current levels.
The Impact of a Shrinking Supply
Lower exchange balances alter how markets respond to demand. With fewer tokens readily available, even moderate buying pressure can have a larger effect. This does not guarantee higher prices, but it does reduce resistance when demand increases.
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The launch of multiple spot XRP ETFs over the past few months adds another layer to the supply equation. These products require physical XRP to back shares. Each inflow removes tokens from the open market. Those tokens do not return to exchanges for active trading.
As ETF assets grow, they introduce steady and consistent demand. This demand operates independently of retail sentiment. Over time, it further reduces the available supply. Combined with already declining exchange balances, the effect compounds, and it could push XRP toward a supply shock and much higher prices.
With exchange supply at seven-year lows, XRP enters 2026 with a tighter liquidity profile than at any point in recent history. If demand increases through ETF growth, adoption, or institutional allocation, it will meet a smaller pool of liquid tokens.
Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are advised to conduct thorough research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.
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