According to the latest data from market intelligence firm Santiment, the profitability of active XRP wallets has dropped to its lowest level since the FTX collapse in November 2022. The average return over the past year for active wallets on the XRP Ledger stands at a staggering -41%, driving the Market Value to Realized Value (MVRV) ratio deep into undervaluation territory.
MVRV Plunges to Multi-Year Low, History Points to Reversal
Santiment highlights that this MVRV reading represents the most severe divergence between market value and realized value since the FTX debacle. In November 2022, after the capitulation event, XRP surged 63% within just 4.5 months. If historical patterns hold, the digital asset could recover and potentially reclaim the psychological $2 threshold, last seen in January 2026.
Despite an optimistic start to 2026, XRP faced a steady retracement, ending the first quarter with an overall decline of more than 25%. However, after hitting a yearly low of $1.22 in early February, XRP has consistently defended the $1.30 mark, establishing it as a primary line of defense for bulls.
Exchange Net Position Plummets, Temporary Demand Exhaustion
On-chain indicators present a more cautious outlook. The net position change on exchanges dropped sharply from 117 million XRP at the end of March to 57 million XRP on April 5, suggesting a temporary exhaustion of buyer demand on centralized exchanges.
In a post on X, Santiment reinforced the narrative that extremely negative MVRV levels often precede major trend reversals. “Since crypto is a zero-sum trading game, significantly negative average returns imply there is much lower than average risk in buying or adding to positions,” the firm noted. It added that when the market enters “blood in the streets” territory, the risk of further downside is statistically lower than the potential for a relief rally, as the weakest hands have already capitulated.
The Contrarian Case: Buying the Capitulation
While the immediate trend appears bearish due to dwindling exchange demand, the underlying on-chain data suggests XRP is deeply oversold. For contrarian investors, the combination of a 41% average loss and a multi-year low MVRV offers a compelling “buy the capitulation” thesis.
However, the actual recovery depends on broader market sentiment and Bitcoin’s trajectory. XRP currently hovers around $1.30. If this support breaks, it could test $1.22 or lower. Conversely, a firm hold and a break above $1.50 resistance could reignite bullish momentum.
Santiment emphasizes that when the average trader is deep in the red, the risk/reward ratio for new entries improves significantly. Historical data supports this view: previous MVRV lows for XRP have marked bottoms that preceded substantial rallies lasting weeks to months. With the current reading matching those extremes, the crypto community is watching closely whether this time will be different or if history will repeat itself.