Karla Barker 
XRP has seen a notable rally this week, climbing over 3% to break above the $1.15 level for the first time since early May. The move aligns with increased activity from larger holders, known as whales and sharks, who have added 2.8% to their XRP positions over the past five weeks. Meanwhile, smaller retail wallets have reduced holdings by 5.2%, a divergence that historically favors the larger holders’ influence on price direction.
Whale accumulation and retail exit
The data from Santiment shows a clear pattern: wallets holding between 100,000 and 100 million XRP have been accumulating, while those with less than 0.01 XRP have been selling off. This kind of divergence often supports a rally, as big players tend to drive market trends. However, the retail exit could also signal that some traders are pricing in risks that accumulation alone might not offset. If the gap between whale buying and retail selling narrows, the bullish setup could weaken faster than expected.
ETF demand and spot market cooling
Spot XRP ETF demand showed a brief bump on July 20, with Bitwise’s fund seeing $2.49 million in net inflows, but other issuers remained flat. Overall, institutional interest has cooled from the peaks seen in April and May 2026. At the same time, spot trading volumes on major exchanges have dropped sharply. Upbit’s weekly XRP volume fell 51%, from 530 million to 258 million XRP, while Binance spot flows declined by nearly 99%. This suggests that fresh spot buying is fading.
Rising leverage and potential risks
Derivatives markets tell a different story. Binance XRP open interest has climbed 5.9% to $423.8 million, pushing leverage ratios to recent highs. More of the rally now seems driven by leveraged positions rather than new spot demand. If spot interest continues to decline while leverage keeps rising, XRP’s breakout could struggle to sustain itself. In such a scenario, the current rally might turn into a classic bull trap, where prices rise briefly before reversing sharply. The retail exit, in this context, may be an early warning that the market is shifting toward short-term rotation rather than a lasting structural trend.