XRP Records Largest On-Chain Realized Loss Spike Since 2022

XRP holders have endured a brutal wave of capitulation, but new on-chain data shows that the worst of the sell-off may finally be in the rearview mirror. 

According to the crypto analytics firm Santiment, XRP has just recorded its largest spike in on-chain realized losses since late 2022.

Historical patterns indicate that this level of extreme fear often has a tendency to coincide with a structural market bottom.

Complete capitulation

A “realized loss” occurs when an investor sells their coins at a price lower than their original purchase price. It indicates that a large number of traders are panicking and locking in their losses.

According to Santiment, this behavior is a hallmark of “fear taking over” the market. However, it serves as a critical contrarian price signal.

When a wave of heavy realized losses washes over the market, it usually means the “weak hands” have already sold their positions.

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With the panic sellers flushed out, there is a significantly reduced overhang of potential sellers left to drive the price lower.

In simple terms, the heavy damage has already been done, and the market has reached an emotional tipping point.

The chart features a massive, sudden downward spike in the purple line. Over the course of the week, those total realized losses ballooned to a staggering $1.93 billion.

The last time the XRP network witnessed a weekly realized loss milestone of this exact magnitude was roughly 39 months ago, in November 2022.

Following that identical capitulation event in 2022, the price of XRP proceeded to jump 114% over the subsequent eight months. 

Not a guarantee 

Santiment is quick to point out that extreme fear tends to peak before the price actually bottoms. This massive realized loss spike does not guarantee an immediate, overnight rally, but it drastically increases the probability of a bounce. Once the sellers are fully exhausted, even a small influx of new buying pressure can push prices significantly higher.

Morgan’s assessment aligns directly with the psychological lifecycle of a market correction. When traders panic and lock in nearly $2 billion in losses over a single week, it traditionally marks the final, most painful phase of a market flush.