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Less than 48 hours remain before the U.S. midterm elections.
This is the first big election to follow the 2024 presidential elections that sent the crypto market into a frenzy after pro-crypto Donald Trump won.
But now that the odds of a Democratic sweep of the midterms are over 73%, it brings up the question whether crypto will do the same if the Republicans fall short.
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The stakes are higher for Ripple. As the chart below shows, $XRP had the most explosive rally of the post-election period in 2024. It rose over 280% in November. The key takeaway? November has historically been $XRP’s strongest month, with average returns above 80%.
That naturally puts Ripple [$XRP] under the spotlight ahead of the upcoming elections.
Interestingly, XRPL is exhibiting a balanced picture on-chain, as the number of transactions is currently hovering around 3.29 million, while the volume of transactions is sitting at just under $2.32 billion. Active addresses are also an important metric to monitor. While transactions are being processed, the adoption of users needs to increase.
In essence, Ripple has been relatively quiet on-chain. This raises a key question: Can $XRP’s ongoing supply squeeze provide enough bullish pressure to fuel a breakout, even as on-chain demand remains subdued?
Ripple kicked off November with its scheduled 1 billion $XRP escrow unlock.
However, shortly after, 700 million were re-locked, meaning that the net amount being released is actually 300 million. It’s common for a large amount of tokens to be locked back into escrow each month. In the past year, Ripple has unlocked 12 billion $XRP but has also locked 8.4 billion.
This means that the real amount of supply coming into the market is far smaller than the 1 billion figure.
As can be seen in the post below, Ripple has placed 700 million $XRP back in escrow through three transactions. Simply put, this means that these tokens cannot be released into the market immediately.
After the 1 billion $XRP was unlocked, there are now just 300 million $XRP available outside of escrow. This means less supply pressure.
Against this backdrop, $XRP’s on-chain signals start to matter.
According to SoSoValue, ETFs have so far seen an impressive increase of $4.32 million in weekly inflows, surpassing last week’s $4.25 million, with the best weekly inflows since mid-September.
Combined with recent whale activity, the fact that $XRP has been able to stay above $1.20 suggests it could be in an early accumulation phase.
With the midterm elections approaching, this setup puts $XRP on the watchlist for a potential post-election rally, provided broader market sentiment turns bullish.
Ripple locked 700 million of the 1 billion unlocked $XRP back into escrow. In turn, leaving only 300 million in net new supply.
$XRP ETFs saw $4.32 million in weekly inflows, beating last week’s $4.25 million as $XRP held above $1.20, hinting at growing buying interest ahead of the midterms.
