As XRP continues to show mixed price action after multiple weeks of extreme volatility, the latest onchain data from crypto analytics platform CryptoQuant shows that XRP reserves across all major exchanges have remained substantially high.
While the metric has drawn attention from market participants, analysts reveal that the surge in XRP supply indicates that traders are reducing leveraged positions while the amount of XRP held across exchanges remains unusually high.
Nearly 12 billion XRP still available for sale
Per the data, the aggregate XRP exchange reserves have surged to 11.81 billion tokens as of October 17, nearing the highest levels recorded over the last year.
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This means that the available supply of XRP across all exchanges has yet to reach its highest level of the year, but it remains unusually high.
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While the massive surge in XRP reserves has come as its price struggles to recover from its recent decline, market participants are beginning to raise questions about whether the growing exchange supply could have been fueled by selling pressure.
Nonetheless, this provides a bearish outlook for XRP, especially at a time when the broader crypto market is facing a major downtrend.
XRP OI on Binance Drops by 15.8%
The data further showed that the rise in XRP exchange reserves coincides with a notable reduction in leveraged trading activity on Binance, the world's largest cryptocurrency exchange by volume.
As of October 17, the Binance XRP open interest stood at $453 million, marking a decline of 15.8% from $538.1 million recorded on October 4.
This suggests that interest in the XRP derivatives market has decreased as traders close or liquidate positions.