After being one of the standout performers following Donald Trump’s election win last year, the asset is now grappling with a slowdown across several core indicators that support its market strength.
Recent on-chain data suggests that interest in using the XRP Ledger has thinned out dramatically. Instead of focusing on price alone, analysts say the broader picture reveals weakening demand from both network participants and derivatives traders — a combination that often precedes deeper market retracements.
XRPL Fee Revenue Falls to Multi-Year Lows
Glassnode’s latest dataset shows a dramatic decline in the economic throughput of the XRP Ledger. The amount of fees collected across the network has been falling steadily since the start of the year, and has now returned to levels last observed in December 2020.
Daily fees have shrunk to roughly 650 XRP, a steep drop from the 5,900 XRP recorded in early February. In percentage terms, that’s an 89% collapse, signaling a sharp downturn in transaction-driven activity.
For analysts, fee compression often signals a softer user base and less transactional demand — both of which can weigh on token valuation.
Derivatives Markets Echo the Decline
Weakness in network usage is being mirrored in futures markets. Open interest in XRP contracts has been unwinding for weeks, falling from around 1.75 billion XRP in October to approximately 0.74 billion XRP today — a drawdown of nearly 60%.
Funding rates have also edged closer to neutral, slipping from 0.01% to 0.001% on a weekly-average basis. That shift suggests traders are no longer willing to pay a premium to hold long exposure, a common sign of fading optimism.
Technical Outlook Tilts Bearish
Chart observers note that XRP has been forming a descending triangle, a setup that historically leans bearish when accompanied by declining liquidity and reduced speculative participation. If the pattern plays out, some analysts warn the asset could revisit lows near $1.73.
With on-chain demand falling, futures traders stepping back, and sentiment cooling, XRP may need a meaningful catalyst to avoid slipping into a deeper corrective phase — a sharp contrast to the enthusiasm that pushed it higher last year.