$XRP Crypto investor and trader Xaif Crypto has provided a clear assessment of the current XRP market condition, stating that the asset has entered a phase of investor fatigue. He highlighted a sharp decline in the Estimated Leverage Ratio (ELR), which has fallen to 0.16. According to him, this development signifies a decisive shift in market dynamics.

The Estimated Leverage Ratio measures the proportion of borrowed capital used in trading relative to the amount of XRP held on exchanges. A reading of 0.16 is extremely low by historical standards.
Such a metric indicates that both long and short leveraged positions have largely been closed or liquidated. High-risk trades using 20x or 50x leverage, which often amplify volatility through forced liquidations, are no longer a dominant feature of the current market structure.
Xaif Crypto’s interpretation is straightforward: speculative traders have exited the game. Aggressive positioning, which often causes sharp price swings, has significantly decreased. With leverage compressed to these levels, the likelihood of sudden jumps or crashes caused by liquidations is materially reduced.

👉Speculative activity is generally decreasing
The trader further noted that speculative long and short positions have effectively disappeared. During bullish impulses, markets are often flooded with borrowed long positions, creating vulnerability to sharp corrections. Conversely, during downturns, short sellers can accumulate in large numbers, increasing the potential for sudden short squeezes.
The absence of both indicates a state of apathy among short-term participants. Traders seem unwilling to aggressively deploy capital in anticipation of immediate price movements. This condition typically follows prolonged sideways or downward price movements, during which short-term market participants gradually exit due to reduced volatility and limited opportunities.
The chart attached to Xaif Crypto’s post shows that the ELR is decreasing along with its 30-day and 50-day simple moving averages. Both moving averages continue to decline, reinforcing the idea that the leverage reduction was sustainable rather than temporary.
👉Shift to Spot Demand
Xaif Crypto emphasized that he considers the most important consequence of this development to be: XRP has transformed into a “story of spot demand.” In practical terms, this means that derivatives activity is no longer the primary force influencing price dynamics.
Since leverage is largely absent, future price increases should originate from genuine buying activity in the spot market. Organic accumulation, whether from retail holders or institutional participants, becomes the central driver. Under these conditions, rising prices will reflect actual demand for the asset rather than speculative positioning in the futures market.
As of the time reflected on the chart, XRP was trading around $1.39. However, the 30-day and 50-day moving averages remain in decline. This signals that, although the market may be structurally healthier due to reduced leverage, momentum remains weak. Until these averages stabilize or price action decisively moves above them, the current phase of fatigue may persist.
Xaif Crypto’s conclusion is clear: volatility caused by liquidations, which characterized previous periods, has significantly diminished. From now on, XRP’s trajectory will depend on sustained, genuine buying interest rather than speculative bets.