XRP Hits 6-Year Low in Trader Returns as Extreme Fear Signals Potential Rebound
XRP’s average trader returns have fallen to their weakest level in six years, according to on-chain data from Santiment Intelligence, placing the asset in what analysts describe as a deep undervaluation zone.
More notably, XRP’s 30-day MVRV ratio, a key gauge of short-term profitability, has dropped to levels last seen in December 2020. In practical terms, the average XRP trader active over the past month is now down about 47%, reflecting a broad wave of recent capitulation. Per CoinCodex data, XRP is presently trading at $1.34.
Historically, such deeply negative MVRV readings have tended to cluster near major market bottoms. When short-term holders are heavily underwater, selling pressure often exhausts itself, leaving the market in a state where most weak hands have already exited.
In past cycles, this setup has frequently preceded strong relief rallies once sentiment stabilizes.
This latest downturn follows XRP’s strong rally through late 2024 and 2025 that resulted in an all-time high of $3.65, when optimism around Ripple’s regulatory progress, rising institutional interest, and ETF speculation drove aggressive upside momentum.
Nevertheless, as price action cooled, late entrants were caught at elevated levels and forced into losses as volatility returned.Since then, repeated sell-offs have pushed short-term holders deeper into the red, reinforcing fear across the market.
XRP Fear Hits Extreme Levels as Historic Undervaluation Signals Potential Breakout
Santiment’s data points to a clear deterioration in retail sentiment, with discussion trends increasingly dominated by fear, uncertainty & doubt (FUD), as well as capitulation rather than conviction.
Paradoxically, these are often the conditions that precede opportunity rather than further breakdown. With sentiment stretched to the downside and the MVRV ratio firmly in depressed territory, even modest positive catalysts have historically been enough to trigger sharp rebound moves as sidelined buyers step back in.
On-chain activity among large holders has also cooled, with whale transaction volumes down by more than 50%. While some interpret this as a lack of conviction, others see it as a period of accumulation pause, a waiting phase before clearer market direction emerges.
Although weak MVRV readings do not guarantee an immediate reversal, they do suggest that much of the near-term downside may already be priced in.
With sentiment compressed, traders underwater, and valuation signals flashing extreme levels once again, XRP appears to be approaching a pivotal inflection point.
