XRP sentiment falls to 8-month low, and that has been a buy signal before

As a crypto investor, I’ve noticed something interesting with XRP. Online conversations about it have really dropped off – we haven’t seen this little buzz since October. Historically, that’s often been a signal that the price might be about to jump, so some traders see it as a good time to buy, hoping for a quick profit.

Data from Santiment, a firm that analyzes on-chain data, shows that public sentiment towards tokens hit a year-low on Thursday. Their weighted sentiment metric, which considers both the positivity/negativity of comments and how much discussion there is, registered at -0.908.

On Friday, XRP was trading at $1.14, a 2.3% increase for the day. However, this is a significant drop from its value in January, when it traded above $2.40, and is about 69% lower than its peak in July.

According to Santiment, price isn’t the whole story. Traders are losing patience after years of waiting for something to happen with Ripple‘s legal battles and potential adoption by larger institutions. It seems many have either given up or are now expecting less.

Despite increasing positive news and growth for the sixth-largest cryptocurrency, people are starting to feel tired of the constant updates and activity.

The U.S. Senate Banking Committee moved forward with the Clarity Act in May. This legislation would officially define XRP as a digital commodity, placing it under the regulatory authority of the Commodity Futures Trading Commission. It would also solidify guidance the agency issued in March into federal law.

As a researcher following the crypto space, I found Ripple CEO Brad Garlinghouse’s recent statement particularly noteworthy. He described this as a pivotal moment for the industry, emphasizing that digital assets should be subject to the same regulations and safeguards as traditional investments.

If a new bill is approved, Standard Chartered estimates that U.S. XRP exchange-traded funds could see an extra $4 to $8 billion in investments. These funds have already gained around $1.4 billion in popularity since the start of the year, based on data from SoSoValue.

A similar pattern is visible on the XRP Ledger blockchain: activity like payments, automated trading, and real-world asset tokens all reached new highs this year, even as the price of the token decreased. Numerous test projects were launched, including a successful demonstration where Ondo, JPMorgan’s Kinexys, Mastercard, and Ripple quickly settled tokenized Treasury bills using the ledger.

Santiment observed a contrast: while development, network activity, and interest from institutions were all increasing, social media excitement was declining.

XRP often sees price increases when there’s little public interest and a lot of negativity surrounding it. According to Santiment, this pattern has happened before – strong rebounds have historically followed periods of low discussion volume and overwhelmingly negative sentiment, which is what we’re seeing now.

Sentiment readings shouldn’t be used to predict *when* something will happen, but rather as a sign that selling pressure is easing. Whether this leads to a positive change depends on if there’s enough demand to actually drive prices up after a long period of waiting.