The digital asset XRP has begun emitting three critical technical signals that preceded its historic November 2024 rally, according to on-chain data from CryptoQuant reported this February 24, 2026. With a current value of $1.39, the ecosystem reflects extreme liquidity compression which, historically, has served as a catalyst for parabolic movements toward new highs.
The current market structure suggests that selling pressure may be exhausting, giving way to an imminent breakout configuration. XRP experienced a rally from $0.5 to $3.4 following the 2024 U.S. elections, and analysts observe that inflows to Binance have again reached levels of tens of billions of tokens, replicating the previous volatility pattern.
Unlike conventional interpretation, the increase in exchange deposits is not resulting in a price capitulation. On the contrary, these inflow spikes preceded the 2024 surge, acting more as a fuel injection for volatility than as a mass liquidation. This statistical anomaly is the first pillar supporting the thesis of a move toward $10.
Technical scarcity in liquidity pools sets the stage for a major leap
The second determining factor is located in the Automated Market Maker (AMM) pools of the XRP Ledger, where USD liquidity has suffered a severe contraction. Backing capital has dropped to levels of 1.9 million, a figure that bears a direct correlation with the 1.5 million floor recorded just before the massive takeoff observed at the end of 2024.
This dryness in order books implies that any increase in institutional demand will generate a disproportionate impact on the price. According to the principles described in the XRPL Portal, AMM efficiency depends on pool depth; therefore, reduced liquidity facilitates rapid vertical shifts in the face of modest buy orders.
Is the current supply compression the prelude to a historic price shock?
The third signal, and perhaps the most alarming for bears, is the drastic reduction of available XRP inventory. In February 2026, average liquidity has fallen to 1.385 million XRP, placing it below the 1.5 million average that triggered the previous rally. This relative scarcity suggests that the actual circulating supply is much lower than perceived.
This “supply shock” phenomenon is enhanced by the maturity of the current regulatory framework. Reviewing Ripple’s compliance documents, it is evident that legal clarity has allowed for greater asset retention by custodians. This retention limits the availability of tokens in the open market, exacerbating upward pressure during accumulation phases.
From a macroeconomic analysis perspective, the repetition of this three-step pattern—exchange entry, USD contraction, and XRP compression—gives a high statistical probability to the bullish scenario. Xaif, a CryptoQuant analyst, notes that confirmation will arrive when USD liquidity begins to expand again after the initial breakout. This expansion-contraction cycle is typical of assets in a revaluation phase.
The technical target of $10 would represent a 619% increase from current levels, an ambitious figure but grounded in historical price relationships. However, the derivatives market structure and funding rates must remain at neutral levels to avoid a flush of long positions. The success of this projection will depend on the stability of the $1.30 support.
Toward the end of the first quarter of 2026, investors should closely monitor whale wallet activity and XRPL adoption milestones. If history repeats itself with the precision suggested by on-chain data, XRP could be on the doorstep of its most aggressive cycle. Monitoring net flows toward decentralized pools will be the key to validating this technical paradigm shift.
