XRP exchange-traded fund (ETF) investors are largely holding their ground despite the digital asset’s price falling approximately 25% below their estimated acquisition cost. This resilience is notable for digital asset funds.
Data from analytics platform XRP Insights indicates only a minor reduction in overall XRP exposure across various U.S.-listed funds, suggesting a notable resilience among institutional and retail investors even as the broader cryptocurrency market faces headwinds.
Resilience in digital asset funds
As of October 29, 2026, XRP traded near $1.29, significantly lower than the modeled average purchase price of around $1.71 for the exposure accumulated in these funds.
This steadfastness among investors comes at a time when XRP’s valuation has been under considerable pressure. The minimal selling activity observed suggests a long-term outlook, with fund holders seemingly undeterred by the current market depreciation. It highlights a critical aspect of market sentiment in the digital asset space: conviction can sometimes outweigh short-term price movements, particularly within structured investment vehicles like ETFs.
The cryptocurrency XRP has seen its price slide considerably, trading approximately a quarter below the average cost at which XRP funds are estimated to have acquired their holdings.
This translates to a notable gap: XRP’s market price of about $1.29 on October 29, 2026, compared with XRP Insights’ modeled acquisition cost of $1.707 for a six-product portfolio, or $1.712 when including the Bitwise 10 Crypto Index Fund (BITW). These figures imply price disparities of 24.4% and 24.6% respectively.
Despite this substantial paper loss, the latest data shows remarkably little selling pressure from the managed funds. XRP Insights recorded a net reduction of only about 2.96 million XRP between October 26 and October 28.
When comparing balances from October 23 to October 28 for the same group of funds, the overall decline stands at just 0.26%. This marginal decrease suggests that the vast majority of existing exposure remains firmly in place, demonstrating investor reluctance to divest their positions despite the valuation drop.
The total exposure across these US-listed products remains considerable. XRP Insights’ snapshot from October 28, 2026, estimated approximately 1.17 billion XRP of exposure across six key products.
This figure rises to 1.19 billion XRP when accounting for the XRP sleeve within the diversified Bitwise 10 Crypto Index Fund, a significant aggregation of the token under professional management. This substantial base underscores the institutional commitment to XRP as a digital asset, even through periods of downturn.
Understanding the estimated acquisition cost
The modeled acquisition cost, estimated at around $1.71 per XRP, offers a critical perspective on the funds’ current positions. This metric, provided by XRP Insights, begins tracking each fund’s initial holdings observation from December 2025.
It values that opening balance at the day’s XRP price, then subsequently adds increases at each day’s reference price, while removing decreases at the portfolio’s average cost. This approach provides a dollar-weighted average price reflecting when the underlying XRP entered the funds.
However, the model has inherent limitations. Funds that pre-existed the dataset’s December 2025 start date are entered at their price at that initial observation, and some historical holdings data has been reconstructed. Consequently, these assumptions mean the estimate cannot perfectly reflect the precise original purchase prices for all underlying XRP.
Additionally, the model does not account for the individual trading activity of shareholders, who may have bought ETF shares long after the underlying XRP was acquired by the fund, at different share prices or with premiums and discounts to net asset value.
It’s also important to note that the acquisition cost estimate excludes various fees and premiums or discounts applied at the shareholder level.
Therefore, while the 25% gap between the current market price and the modeled acquisition cost is significant for the funds themselves, it doesn’t automatically mean all ETF shareholders are collectively down by that exact amount. Nor does the $1.71 figure act as a price floor or a contractual liquidation threshold for the funds.
An alternative calculation that factors in implied prices from fund net asset values raises the combined estimate to $1.7458, placing XRP at $1.29 about 26% below that figure.
Broader market headwinds and XRP’s price trajectory
The current struggle in XRP’s valuation is not an isolated event but part of a wider trend that has seen the cryptocurrency face significant price pressure over the past year. XRP’s one-year decline reached 50.71% as of October 29, 2026, reflecting a sustained bearish sentiment.
This comes after a notable 25% price drop throughout 2025 and a roughly 50% fall from its year-to-date high in the same year, when it briefly touched $1.8485. The token also traded 65% below its record high of $3.65 reached in July 2025.
Several factors have contributed to this downturn, including profit-taking activities and a deceleration in spot fund inflows, which indicate a cooling of fresh investment interest. Macro-driven risk aversion has swept across the broader digital asset market, pushing investors away from riskier assets like cryptocurrencies.
There’s also been a clear divergence between positive news on enterprise adoption of XRP and a lack of direct spot asset demand, suggesting that corporate payment initiatives have not translated into sustained open-market token accumulation.
Further exacerbating the price pressure are dynamics within the crypto derivatives markets, including the unwinding of leverage and accelerated liquidations of long positions. A contraction in futures open interest, coupled with high retail long positioning, often signals an impending correction.
The 37 billion token escrow controlled by Ripple, which allows for the monthly release of up to 1 billion tokens, also creates an overhang that contributes to selling pressure. Adding to this, an influx of nearly 50 million XRP tokens recently deposited onto centralized exchanges has directly increased overhead selling pressure.
Broader market weakness, highlighted by events such as a hawkish Federal Reserve tone and a hotter-than-expected US Consumer Price Index reading on October 14, 2026, further dampens expectations for monetary easing and negatively impacts risk assets.
Dynamics of XRP ETF flows and creation mechanisms
The operation of XRP ETFs involves intricate creation and redemption mechanisms that influence the overall token flows. Authorized participants, often large financial institutions, handle the creation of new ETF shares.
A cash creation typically requires the fund itself to acquire XRP from the market, while an in-kind creation means the authorized participant delivers XRP directly to the fund. This distinction is crucial because an in-kind creation doesn’t necessarily indicate a fresh spot-market purchase at that precise moment.
Examining the flow data reveals a nuanced picture. While XRP ETFs have accumulated over $1.8 billion in cumulative net inflows by October 26, 2026, the total net assets stood at $1.57 billion as of October 12, 2026.
This discrepancy of approximately $230 million to $329 million, depending on the measurement date, signifies that the XRP purchased by these funds is currently valued less than what investors initially paid. This “gap” is a direct consequence of XRP’s depreciating price.
Despite the recent turbulence, fund activity shows varying trends. Bitwise’s XRP holdings, for instance, decreased from about 416.61 million XRP on October 23 to 413.82 million on October 26, before remaining flat through October 28. Similarly, Franklin Templeton and 21Shares saw their holdings stay flat across these sessions.
On the positive side, October 28 recorded an addition of approximately 174,140 XRP across the tracked funds, partially offsetting earlier declines. Understanding these specific fund movements is vital for gauging whether investor demand for XRP ETFs is truly expanding or merely consolidating.
Regulatory journey enabled XRP ETF market growth
The establishment and growth of the XRP ETF market are deeply intertwined with the regulatory clarity that has gradually emerged around the digital asset. For years, the legal status of XRP remained ambiguous due to a protracted lawsuit initiated by the U.S. Securities and Exchange Commission (SEC) against Ripple Labs in December 2020.
The SEC alleged that Ripple’s sales of XRP constituted unregistered securities offerings, casting a long shadow over the token’s future.
A pivotal moment arrived on July 13, 2023, when Judge Analisa Torres ruled that programmatic sales of XRP to retail investors on exchanges were not securities transactions, though direct institutional sales were. This ruling, followed by the official closure of the case in August 2025 with a reduced settlement and a permanent injunction on U.S.
institutional sales, significantly de-risked XRP for institutional adoption. Further solidifying its standing, the SEC and CFTC jointly classified XRP as a “Digital Commodity” on March 17, 2026, paving the way for regulated investment products.
This regulatory certainty spurred a wave of ETF innovation. While the first U.S. futures-based XRP ETF, ProShares Ultra XRP (UXRP), launched in July 2025, the real shift came with spot ETFs. The REX-Osprey XRP ETF (XRPR) debuted as the first U.S.-listed spot XRP ETF on September 18, 2025, experiencing strong initial trading volume.
This was quickly followed by a flurry of launches in November 2025, including Canary Capital’s XRPC, Bitwise’s XRP ETF, Grayscale’s GXRP, Franklin Templeton’s XRPZ, and 21Shares’ TOXR. These launches have collectively opened new avenues for investors to gain exposure to XRP through regulated, traditional financial instruments.
What comes next for XRP ETF demand
The future trajectory of XRP ETF demand will largely depend on clear, observable signals of sustained expansion rather than transient fluctuations. A truly strong indication of renewed net expansion would involve consistent increases in both XRP holdings and the number of shares outstanding across multiple issuers, with matching observation dates providing verifiable data. This would distinguish genuine growth from mere short-term trading arbitrage or rebalancing.
Furthermore, greater transparency around the funding mechanisms of ETF creations is essential. Creation records that clearly differentiate between cash-funded acquisitions, which typically involve new spot-market purchases, and in-kind transfers would offer a more precise understanding of fresh capital entering the XRP ecosystem.
Similarly, separating fees and index adjustments from core holdings data would simplify the interpretation of net additions and provide a clearer picture of underlying demand.
Conversely, a sustained and persistent reduction in XRP holdings across several funds, coupled with falling share counts and consistent redemption activity, would signal a significant weakening of the current largely retained portfolio.
It’s important to look beyond just the dollar value of assets under management, as XRP’s price volatility can mask the true movement of underlying tokens. A substantial dollar decline in assets could simply reflect a price drop rather than actual tokens leaving the funds.
As such, continued vigilance of settled issuer observations will be crucial to determine if net holdings resume their expansion or if the recent reduction broadens into a more widespread divestment. Market sentiment and digital assets will undoubtedly play a pivotal role in shaping this outlook.