XRP Holders Are Selling at a Massive Loss: A Bullish Signal?

XRP holders just booked around $908 million in realized losses over the past week, the sharpest spike in nearly 40 months. On-chain analytics firm Santiment flagged the event on February 21, noting it is the largest capitulation print since November 2022. Back then, weekly realized losses hit $1.93 billion, and what followed was a 114% price rally over the next eight months. With XRP currently trading at $1.41, down 6.32% on the week and 26.25% on the month, the obvious question is whether history is about to repeat itself.

What Do Realized Losses Actually Tell Us?

Realized losses happen when holders sell their tokens for less than they originally paid. It is not a paper loss anymore. It is locked in and final. When this metric spikes, it usually means short-term traders and weaker hands are giving up.

Mass capitulation tends to clear the decks. Once the panic sellers are flushed out, the remaining supply sits with longer-term holders who are far less likely to dump at the first sign of trouble. Fewer sellers, plus returning demand, equal potential price recovery. Simple supply and demand mechanics.

The important caveat: it is not a guaranteed signal. Broader market conditions, regulatory developments, and macro sentiment all factor in. Capitulation alone does not flip a chart green.

What Does the On-Chain Data Show Right Now?

$XRP dipped as low as $1.33 recently before bouncing back to $1.41, sitting at rank four by market cap around $82 to $86 billion. Daily trading volume hit $2.94 billion, surging over 122%, showing the market is far from quiet even during the sell-off.

Whale activity

CryptoQuant analyst Darkfost flagged that large holders moved over 31 million XRP to Binance on February 21. Wallets holding more than 1 million XRP accounted for 14.49 million of that total, with the 100K to 1M band contributing another 14.24 million. That amounts to roughly $45 million in potential sell-side pressure concentrated among big players.

On the derivatives side, $47 million in short positions are stacked near $1.51. If bulls push through that level, those shorts face liquidation, which could trigger a squeeze and accelerate upward momentum.

Signs of recovery

Not everything looks bearish. The Spent Output Profit Ratio (SOPR) has climbed back above 1.0, meaning investors are starting to transact at profits again. Long-term holder accumulation is ticking upward, with HODLer net position changes showing steady inflows. Meanwhile, Glassnode data shows total exchange XRP balances have fallen nearly 55% since late 2025, meaning less supply is sitting in liquid trading positions.

Does History Support the Bullish Case?

The closest comparison is late 2022. XRP saw a similar capitulation spike during peak regulatory uncertainty around the SEC lawsuit. The token bottomed out, exhausted its selling pressure, and then rallied 114% over eight months as fresh capital moved in.

Today, the fundamental backdrop looks arguably stronger. Ripple deployed roughly $2.45 billion in acquisitions during 2025 alone:

• Hidden Road ($1.25B): Now rebranded as Ripple Prime, clearing $3 trillion annually for over 300 institutional clients
• GTreasury ($1B): Treasury management tools targeting Fortune 500 companies
• Rail ($200M): Stablecoin payment rails handling roughly 10% of global B2B stablecoin flows

Total ecosystem investments exceed $4 billion, according to Ripple, and the company's stablecoin, RLUSD, has surpassed $1.5 billion in market cap.

Regulatory progress is also notable. On February 16, Arizona's Senate Finance Committee advanced SB1649 in a 4-2 vote, a bill that would create a Digital Assets Strategic Reserve Fund with XRP explicitly named alongside Bitcoin and DigiByte. The bill still needs full Senate and House passage plus the governor's signature, but the committee-level progress signals growing recognition at the state level.

On X, community sentiment leans heavily bullish. One user pointed out that nearly a billion in realized losses, with the price still holding above $1.38, suggests someone is absorbing every sell order. Sentiment polls on CoinGecko show 81% bullish, and technical indicators, including a bullish triangle and bottom-hammer candles, suggest potential reversal setups.

What Could Go Wrong?

XRP is trading near its realized price around $1.40, a level that on-chain data shows historically aligns with weaker market phases where rallies tend to stall. The token has retraced roughly 62% from its July 2025 all-time high of $3.65 and remains stuck below key resistance between $1.51 and $1.60.

Without a strong catalyst, there is always the risk of a dead cat bounce. Broader crypto weakness, including Bitcoin's own slide toward $65,000 amid U.S. tariff jitters and geopolitical tensions, could keep dragging altcoins sideways.

The data paints a compelling contrarian picture. Mass capitulation has historically marked turning points for XRP, and on-chain metrics are shifting in a more constructive direction. But conviction alone does not move price. Watch $1.30 support on the downside and $1.51 resistance on the upside. How XRP handles those levels in the coming weeks will tell you more than any sentiment poll.

Sources:

• Santiment Original post flagging the realized loss spike and historical comparison
• CoinMarketCap XRP live price, market cap, volume, and ranking data
• Bitcoinist Reporting confirming the $908M weekly realized loss figure from Santiment
• Invezz XRP price action and Santiment data breakdown
• CoinDesk Analysis of realized losses and market structure
• BeInCrypto Whale movements, short liquidation levels, and MVRV data
• NewsBTC Darkfost's breakdown of 31M XRP whale transfer to Binance
• The Crypto Basic Arizona SB1649 bill advancing through Senate Finance Committee
• crypto.news XRP price testing $1.30 support amid realized loss spike
• 24/7 Wall St. Breakdown of Ripple's $2.45B+ acquisition spree in 2025