XRP futures lose $700M while XRPL’s $4B institutional pipeline keeps building
XRP is being pulled in two directions, and I do not think the split is subtle anymore. Futures traders have cut exposure by nearly $700 million. US spot XRP ETFs just logged their first outflows in nine weeks. That is the weak side of the story. The odd part is happening at the same time: the XRP Ledger reportedly has a $4 billion pipeline tied to institutional tokenized assets. So, yes, the question is plain enough. Can banks and asset managers offset retail traders losing interest?
The ETF numbers are not huge. They matter anyway. US spot XRP exchange traded funds saw about $7.2 million in net outflows in the week ended July 10, ending a nine week run that had brought in nearly $200 million. Against total net inflows of $1.48 billion, $7.2 million is not a crisis. My take: calling it panic would be lazy. Still, it ranks among the five largest XRP fund outflows this year. Add lower futures exposure and some of the weakest XRPL user activity of 2026, and the market starts to look thin. Demand is cooling in regulated products. It is cooling in the broader market too.
The futures market is saying almost the same thing, but with sharper edges. Global open interest in XRP futures fell from nearly $3 billion in June to about $2.3 billion by mid-July, according to CoinGlass. Binance’s XRP open interest dropped from more than $500 million in mid-June to $399 million by July 10. Long liquidations rose 94% from the prior week and were 172% above their three month average. Short liquidations were down by more than half. Here is the weird part: Binance’s XRP funding rate rose 266% in the same week. Why does this matter? Because the remaining bulls are paying more to stay in a trade that is getting smaller. That can hold for a bit. Then price slips, funding resets, and more longs get pushed out.
Network activity is narrowing too. Santiment said XRPL had its second quietest day of the year this week, with only 25,350 active wallets. New wallets fell to 2,130, the lowest level since November 2024. Not great. That is not the number you want if the bull case depends on fresh users arriving. The slowdown followed a short round of dip buying in late June. Since then, there has not been an obvious price catalyst. There has not been an obvious network catalyst either.
There is one useful wrinkle, and this is where the simple bearish read starts to wobble. Transactions with source tags, which exchanges and payment providers often use, rose 28.6%. The number of source tags rose 13%. So existing services may be doing more on XRPL even as the crowd thins out. CryptoQuant shows the same split: transaction counts were up 3% to 4% over the previous week and month, but still 21% below their three month average. Active addresses are 11% below their three month baseline. The network value to transactions ratio eased, which points to steadier use. But user participation is still below recent norms. Both can be true.
That puts more weight on the institutional side. XRP has fallen about 5% over the past week to roughly $1.11, while institutions keep testing XRPL for tokenized assets and settlement. Evernorth, an XRP focused digital asset treasury company, says about $4 billion of tokenized real world assets are tied to the network across more than 500 products. I’ll be honest: this is the part retail traders may be underpricing. It is a useful data point, not just stage talk.
Developers are also working on the proposed XLS-96 standard for confidential transfers. It would use encryption and zero knowledge proofs to hide individual balances and transfer amounts. Most crypto guides say transparency is the whole point of public chains. That is only half right. Banks and asset managers care about auditability, but they also care about not exposing every position and payment trail to the entire market. They are not going to move sensitive flows onto a public chain if every position and payment trail is easy to inspect. Selective disclosure for regulators and auditors could help, especially alongside existing controls such as freezing and clawback functions. Is this boring infrastructure? Yes. Is it the kind of plumbing institutions tend to ask for before they move serious money? Also yes.
There are already live examples. In May, Ondo Finance, Ripple, Mastercard, and JPMorgan’s Kinexys platform completed a cross-border redemption involving Ondo’s tokenized US Treasury product. The tokenized asset leg ran on XRPL in less than five seconds. That detail matters more than a broad adoption claim. We have seen plenty of vague blockchain partnership language over the years; this is more concrete. It shows XRPL can connect with traditional financial infrastructure and process a real world asset settlement quickly.
Confidential transfers could make that easier to scale. More tokenized assets and settlement flows on XRPL could increase demand for XRP if the token is used for liquidity, transaction fees, collateral, or settlement. Yes, this slightly contradicts the bearish flow data above. Bear with me. The “if” matters. Institutional activity does not automatically save the token price. But it does give XRP another story at a time when the retail story looks tired.
What this means
XRP is in an awkward spot. Futures open interest is down sharply, ETFs just broke a nine week inflow streak, and network growth looks weak. That usually means less speculative demand. If funding rates stay high while price drifts lower, another wave of long liquidations would not be surprising. Simple setup. Uncomfortable chart.
The network data is mixed, not dead. Established services appear to be using XRPL more, even as new wallet creation drops. This is the distinction I would keep front and center: are traders excited, or is the network useful? Right now, traders look less excited. The institutional use case still has a pulse. Counter to the usual advice, watching wallets alone may miss the better signal here.
The main thing to watch is XLS-96. If confidential transfers ship and large financial firms actually use them, XRP could get a cleaner utility story through liquidity, fees, collateral, or settlement. If that does not happen, and ETF flows and futures open interest keep fading, XRP could stay stuck or drift lower. The $1.00 level is the obvious line on the chart. A clean break below it could bring more selling. Steady institutional news could help hold the floor, but it has to be more than press releases.