Bought 192 million units in 10 weeks... Why are XRP (Ripple) spot ETFs experiencing losses?

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Despite XRP (Ripple) spot ETFs increasing their holdings by 192 million units over 10 weeks, their assets under management decreased by 29%, showing a paradox where consistent buying did not lead to profits. The 7 US-listed ETFs secured a record high of 992.5 million XRP, but approximately $440 million out of the cumulative investment of $1.44 billion was lost due to unrealized losses.

According to investment media outlet TradingNews on August 5 (local time), the total assets under management for the 7 US XRP spot ETFs amounted to $1 billion as of August 4. The quantity held by these products is 992.5 million XRP, approximately 1% of the total supply. Applying the current price of $1.0773, this amounts to about $1.069 billion. Since their launch in November 2025, cumulative net inflows have been $1.44 billion, but assets under management remain at $1 billion, meaning approximately 30% of the initial investment has been reduced due to unrealized losses.

The trend of held tokens and asset value was precisely opposite. From late May to early June, the 7 ETFs held over 800 million XRP, worth approximately $1.4 billion, but by August, holdings increased by 24% to 992.5 million XRP, while assets under management decreased by 29%. This is due to the price dropping from the $1.20 range to $1.0773, even after investing approximately $200-230 million over about 10 weeks to acquire an additional 192 million XRP. Although the products continued to absorb tokens, they could not overcome the supply from escrow releases and selling by long-term holders.

The slowdown in institutional demand is also evident. On 11 of the 22 trading days in July, there were no fund inflows or outflows at all, and the monthly net inflow amounted to only $27.29 million. This represents a 96% decrease compared to the first month of launch ($666 million) and a 71% decrease compared to May ($94 million). Approximately 1.16 billion XRP are awaiting at the breakeven point around $1.45, creating a sell wall worth about $1.25 billion at current value, which is also identified as a factor limiting price increases.

On the supply side, changes were detected. On August 1, Ripple re-locked 700 million XRP out of the regular escrow release of 1 billion XRP, reducing the net supply to 300 million XRP. This is a 70% reduction compared to the original schedule. Based on current prices, the monthly net supply is approximately $323 million, and the supply-to-demand ratio compared to the ETF's average monthly demand of about $160 million has also decreased from 7:1 to approximately 2:1. However, it is unconfirmed whether this measure will continue in September. The media analyzed that if a breakthrough above $1.20, a recovery of monthly ETF inflows to $50 million, and continued escrow reduction align, the price could aim for $1.35, but if $1 breaks, it could fall to $0.95 and $0.88.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*