Ripple XRP Struggles as ETF Flows Slow and Blockchain Usage Falls

U.S. spot XRP ETFs brought in just $107,000 on July 10—a figure so small it barely registers for a segment that was drawing more than $100 million in monthly inflows just two months ago.

Combined assets under management (AUM) across the seven XRP funds have now slipped below $1 billion to about $996 million, breaking what had been one of the steadier institutional accumulation trends in this crypto ETF cycle.

The central question is no longer whether institutional demand has weakened—it clearly has—but whether this slowdown reflects a temporary pause in a broader allocation strategy or the start of a more persistent pullback.

That distinction is critical for XRP’s price outlook, which has so far held above $1 despite fading demand from both retail and institutional participants.

From Surge to Standstill

The reversal in XRP ETF flows has been swift. In May 2026, the funds collectively attracted more than $100 million, supported by consistent inflows week after week.

July tells a very different story. Several sessions have recorded zero inflows, while July 8 saw $7.29 million in net outflows—one of the largest single-day declines since March 2026.

In the span of six weeks, momentum has shifted from steady accumulation to near stagnation. Notably, a large share of July’s outflows appears concentrated in a single issuer, suggesting fund-specific redemptions rather than a coordinated institutional exit. This nuance will become clearer as additional flow data comes in.

What Could Reignite Demand

Ripple’s RLUSD stablecoin is already generating roughly $2.5 billion in volume on the XRP Ledger, while about $4 billion in tokenized real-world assets are currently active on the network.

Upcoming upgrades include native lending and an already operational Ethereum-compatible sidechain. If these developments translate into sustained on-chain activity—measured by growth in active addresses and new wallets, not just transaction volume—they could help bring ETF inflows back by signaling genuine usage.

If they fail to gain traction, XRP may continue to drift sideways, supported largely by long-term holders while institutional investors wait for clearer confirmation before reallocating capital.

The bearish scenario is less about a sharp collapse and more about gradual erosion, where continued ETF outflows slowly weaken support and signal a deeper shift in institutional conviction.

Broader market conditions will also matter. A rebound in Bitcoin ETF inflows and improving risk sentiment could lead to renewed capital rotation into XRP products.

For now, July’s data stands as a warning sign. While XRP ETFs have attracted nearly $1.5 billion in cumulative inflows since launch, whether institutional patience holds through another period of subdued prices and weak on-chain activity remains the key question.