XRP’s $1.11 Floor Cracks as Short Sellers Pile In — Yet Institutions Keep Buying

XRP hits $1.11 low, RSI 19.7 oversold, but on-chain shows accumulation. ETF outflows emerge, yet CLARITY Act and institutional adoption could trigger a short squeeze.

The divergence in XRP has reached breaking point. While the token slumped to a fresh 52-week low of $1.11 on Friday, losing another 7.55% in a single session, the underlying fundamentals tell a completely different story. The Relative Strength Index has plunged to 19.7, deep in oversold territory, as short sellers overwhelm the market at a nine-to-one ratio against longs. Year-to-date losses now stand at roughly 40%, and the token trades nearly 70% below its 52-week peak of $3.65.

On-chain metrics, however, paint a picture of accumulation. More than 25 million XRP tokens have recently departed exchange wallets — a move analysts typically interpret as a reduction in immediate selling pressure. Whale activity and the previous weeks’ ETF inflows had pointed toward steady buying, but the spot market has failed to reflect it. The result is a market split between constructive on-chain behavior and weak traded price action.

That institutional buying streak suffered its first hiccup in June. On June 3, US-listed spot XRP ETFs recorded a net outflow of $5.34 million — the first negative daily flow of the month, driven entirely by Bitwise’s product. Cumulative net inflows still stand at around $1.42 billion, with assets under management at roughly $1.03 billion. The broader trend remains positive, but the direction has shifted. In the prior week, XRP products had pulled in $20.3 million while the wider digital asset market bled $1.67 billion in outflows, and Bitcoin ETFs logged 13 consecutive trading days of red ink totaling $4.37 billion since mid-May. The one exception to the outflow wave was the Hyperliquid token HYPE.

Regulatory catalysts may yet turn the tide. The CLARITY Act officially reached the US Senate calendar on June 1, explicitly naming XRP as a digital commodity and placing oversight under the CFTC. The bill needs 60 votes to pass, and the White House has set July 4 as a target for the president’s signature. Any delay would push legislation into the autumn. Standard Chartered analysts estimate that passage could unleash an additional $4 billion to $8 billion in institutional inflows.

Meanwhile, institutional adoption of the XRP Ledger is accelerating beyond ETFs. Ondo Finance recently executed the redemption of a tokenized US Treasury bond fund in near-real time across borders, with heavyweights J.P. Morgan and Mastercard involved in the fiat settlement. Tokenized assets worth $3.5 billion now sit on the XRP Ledger, and such use cases could become standard once legal clarity arrives.

The coming weeks will decide whether the June 3 ETF outflow was a one-day correction or the start of a broader repositioning. If the CLARITY Act clears the Senate, the heavily positioned short sellers face a potential squeeze that could send XRP surging. For now, the token remains trapped in the same withdrawal cycle as Bitcoin and Ether, waiting for the next weekly ETF-flow report — expected early next week — to reveal whether institutional buyers return or the exodus widens.