XRP holders were sitting on an estimated 83% unrealized profitability, a level that on-chain analysts linked to heightened incentive for profit-taking and a likely short-term price dip. The claim rested on a mix of whale distributions, exchange inflows and momentum indicators that together raised the probability of downward pressure.
The analysis identified several converging signals. Large-scale distributions — described as the biggest single‑month outflow since March 2023 — included movements of roughly 2.20 billion XRP (about $4.11 billion), which amplified selling capacity when many addresses were already in profit. At the same time, spikes in exchange inflows historically preceded material sell phases, a pattern the report flagged as potentially repeatable.
Technical and sentiment measures reinforced the cautionary read. Net unrealized profit/loss (NUPL) thresholds pointed toward an elevated profit-taking regime among shorter‑term holders, while the Money Flow Index registered behaviour consistent with overbought conditions.
Price approaches to cost‑basis clusters at resistance levels further increased the likelihood that some holders would exit to lock gains.
Market interpretation and limits of the signal
The analysis stressed that high profitability is an important signal but not a determinative forecast. “The 83% figure is a data point, not a crystal ball,” the report noted, emphasising that profitability creates an incentive for selling but does not force uniformly identical behaviour across holders.
Distribution by whales can indeed create outsized negative flows. Yet the report also cautioned that other forces — notably institutional demand and ETF flows — can absorb or mute that pressure. Those countervailing flows were presented as plausible stabilisers rather than guaranteed offsets.
For traders and risk managers, the practical takeaway is simple: liquidity and the composition of sellers matter as much as headline profitability. Large holders can shift execution risk into exchanges quickly, and that dynamic can overwhelm thin liquidity windows.
Investors are now watching whether ETF and institutional flows will absorb the excess supply or whether further distributions force a corrective move. The interaction between continued whale selling and on‑exchange liquidity will be the immediate test of whether the 83% profitability level translates into a sustained decline or a short-lived consolidation.
