Behind the 3.17% rise of XRP: The resonance of continuous net inflows of ETF funds and multiple ecosystem drivers

XRP continues to rise on January 5th, currently trading at $2.13, up 3.17% over the past 24 hours. During the same period when Bitcoin and Ethereum spot ETFs are experiencing outflows, XRP spot ETFs still maintain net inflows against the trend. What does this phenomenon reflect? From institutional allocations to ecosystem development, from supply tightening to policy signals, XRP’s upward movement is supported by multiple dimensions.

Institutional Demand as the Main Driving Force

ETF funds continue to flow in, forming a clear contrast

Since the launch of the US spot XRP ETF in November, it has accumulated net inflows of over $1.2 billion, with assets under management surpassing $1.25 billion. More notably, this inflow has remained stable recently — last week, a single-day net inflow reached $70.2 million.

Compared to other assets during the same period, the difference is very obvious: Bitcoin spot ETFs experienced outflows of $2.9 billion, Ethereum spot ETFs saw outflows of $59.5 million, only XRP ETFs are attracting capital against the trend. This indicates a clear divergence in institutional investor attitudes toward XRP compared to other mainstream assets.

Leading asset management firms expanding holdings

Franklin Templeton’s XRPZ fund has for the first time exceeded 100 million XRP, reaching 101.5 million XRP, with a market value of $1.927 billion, growing over 100% in a month. Major asset managers like Canary Capital, Grayscale, Bitwise, and others have also launched related products.

These expansion actions by institutions suggest XRP is shifting from a highly volatile crypto asset to a more tradable financial instrument suitable for institutional portfolios.

Ecosystem Development and Application Deployment Accelerate

Rapid expansion of cross-chain ecosystems

Wrapped XRP has been launched on multiple mainstream networks including Solana, Ethereum, Optimism, Ink, and Unichain, supported 1:1 by native XRP through Hex Trust and LayerZero collaboration. During initial launch, over $100 million in liquidity was locked.

Ripple’s stablecoin RLUSD is also accelerating multi-chain deployment, going live on Ethereum Layer 2 via Wormhole protocol. This marks a deep evolution of XRP’s multi-chain strategy from a single chain.

Breakthroughs in real-world asset tokenization

Tokenized real-world assets (RWA) on the XRP Ledger have surpassed $568 million, with an annual growth rate of 2200%. Among these, RLUSD accounts for over 50%, approximately $293 million, and OpenEden TBILL Vault about $61.46 million.

These figures reflect XRP’s transition from a pure payment asset to a foundational financial infrastructure.

Supply Side Improvement Sends Positive Signals

Exchange reserves hit a seven-year low

Centralized exchanges hold about 1.6 billion XRP, a new low since 2018. This indicates that the available XRP supply for trading in the market continues to tighten.

Although Ripple plans to unlock 1 billion XRP in January 2026, historical data shows that about two-thirds or even up to 80% of unlocked XRP are often quickly re-escrowed, with limited actual flow into the secondary market.

Signals from International Institutions and Policies

Optimistic outlook from traditional financial institutions

Standard Chartered’s global head of digital assets research expressed optimism about XRP, expecting its price to rise to $8 by 2026, representing a potential increase of 280% from the current level of $2.13.

Positive policy developments

The current US president’s public speech emphasized modernizing the financial system through faster payment infrastructure and advanced crypto technologies, which is interpreted by the market as a positive signal for blockchain and crypto payment solutions. As an asset designed for cross-border payments, XRP’s technical positioning aligns with current policy reform directions.

The Japanese government plans to reduce the tax rate on cryptocurrency investment gains from a maximum of 55% to 20%, and intends to launch more ETFs linked to specific crypto assets. These changes create a more favorable environment for XRP’s practical application.

Maturity of Derivatives Market

CME Group has launched XRP futures based on spot prices, with nominal trading volume reaching hundreds of billions of dollars, making it one of the fastest assets to surpass high open interest. XRP futures now support TAS (Trade at Settlement), further facilitating institutional hedging and trading.

The improvement of these infrastructures indicates XRP is gaining more institutional-grade trading tools.

Market Status and Sentiment Analysis

Rising popularity ranking and increased trading activity

According to data, XRP’s popularity ranking has risen to second globally, only behind Bitcoin, surpassing Ethereum. The 24-hour trading volume reached $345 million, indicating abundant market liquidity.

On-chain activity has normalized

XRP Ledger activity has rebounded to pre-holiday levels, with transaction counts and active addresses stabilizing at December baseline, indicating seasonal slowdown rather than structural damage. Network throughput has normalized, showing that user, bot, and institutional processes are fully operational again.

Market sentiment shows divergence

Recent polls indicate that about 70% of XRP holders expect the price to stay below $2 in the short term. This suggests that although fundamentals and institutional interest are improving, market sentiment remains cautious.

Summary

XRP’s recent rally is driven by multiple factors: continuous institutional allocations via ETFs, accelerated ecosystem deployment, ongoing supply tightening, positive signals from international financial institutions and policymakers, and mature derivatives markets.

In the short term, these factors support the price. In the medium term, XRP is transitioning from a purely speculative asset to a real-world application-driven financial infrastructure, and this transformation has only just begun.

However, market sentiment remains cautious, implying a potential expectation gap. Future focus should be on the continued flow of ETF funds, actual progress in RWA applications, and further policy developments.