XRP Becomes Retail Darling, Surpassing Bitcoin in Wallet Activity

• XRP’s daily active addresses surged by 490% since 2022, with nearly 50% of its market cap growth coming from new investors.
• Investors are already seeing a dip in profitability, and as the market continues to fluctuate, the sustainability of XRP’s newfound popularity is yet to be tested.

Glassnode, a leading digital asset analytics firm, has released its latest newsletter, offering a comprehensive analysis of the current trends in the cryptocurrency market. The firm highlights the contrasting paths of institutional and retail investments, focusing on how each group is shaping the market.

Glassnode observes that while Bitcoin investors face mounting losses, a contrasting trend is emerging in retail-driven sectors of the market. Institutional demand through U.S. spot ETFs is gaining momentum, and Bitcoin ETFs have recently recorded $220 million in net inflows, as reported by CNF.

One cryptocurrency that has gained momentum is Ripple (XRP), which has become increasingly popular among retail investors. In addition, asset managers such as Bitwise, Franklin Templeton, 21Shares, WisdomTree, and Canary Capital have shown a growing interest in XRP with their ETF filings tied to the asset. 

Glassnode emphasizes that the surge in XRP’s popularity can serve as a key indicator of speculative demand in the broader crypto space. “Since the 2022 cycle low, the quarterly average of daily active addresses for XRP has jumped by +490%, compared to just 10% for Bitcoin. This stark contrast suggests that retail enthusiasm has been attracted by XRP, thus providing a mirror for speculative appetite in the crypto space.”

A Different Journey for Bitcoin and XRP

While both Bitcoin and XRP have experienced similar growth, rising roughly 5x to 6x from their respective lows, their paths have been notably different. Bitcoin’s rally has been more gradual and steady, fueled by key events such as the launch of U.S. spot ETFs in January 2024, a pro-crypto U.S. administration, the consistent accumulation of BTC by public companies, and its inclusion in the U.S. Strategic Reserve.

In contrast, XRP’s price movement has been marked by greater volatility, with sharp and sudden surges. A particularly dramatic example was seen in December 2024, when the asset surged by 400%, evoking memories of its dominance prior to the SEC lawsuit.

Glassnode confirms that this surge in XRP’s price was accompanied by an increase in its Realized Cap. “During this recent surge, XRP’s Realized Cap nearly doubled from $30.1B to $64.2B, reflecting a substantial inflow of capital.” Notably, nearly $30B of this increase came from investors deploying capital within the past six months, underscoring the short-term nature of this retail-driven rally.

Along with the short surge in capital flows, wealth has become increasingly concentrated in the hands of new investors, as the share of XRP’s realized cap, which is younger than six months, rose from 23% to 62.8% in a short period. This shift suggests that the rally may be short-lived, heightening the potential for greater volatility ahead.

Recent developments, such as XRP’s possible inclusion in the U.S. crypto stockpile and the conclusion of the Ripple vs. SEC lawsuit, have spurred increased activity in XRP’s options market. The options volume for XRP surged by 168.03%, reaching $8.36K, while its overall trading volume dropped by 28.34% to $4.92 billion. In comparison, options volume for Bitcoin decreased by 27.20%, with Bitcoin trading at $82,930.