XRP Now Undergoing a Volatility Vacuum: What Comes Next?

XRP has slipped into a volatility vacuum as trading activity and leverage decline, but this could lead to a rapid price expansion.

Amid the ongoing market pullback, verified CryptoQuant analyst CryptoOnChain says XRP is now moving through what he calls a volatility vacuum. He believes the current situation could lead to a massive price move once the market gets a major catalyst.

Key Points

• XRP climbed to $1.58 on May 14 before falling to $1.38 during the wider crypto market correction.
• CryptoOnChain says XRP is undergoing a “volatility vacuum” as trading activity and leverage decline.
• XRP Ledger daily transactions dropped 20% over three months to around 1.78 million transactions.
• Binance’s Estimated Leverage Ratio dropped to 0.173,  below its six-month peak of 0.260.
• This volatility vacuum could act as a precursor to a price expansion once the right catalyst hits.
• Ali Martinez says a close above $1.50 could send XRP toward $1.80.

Weak Activity Across the XRP Market

In his analysis, CryptoOnChain said XRP is trading in a very quiet market as prices fall. Specifically, after XRP climbed to $1.58 on May 14, it collapsed alongside the rest of the crypto market, and the bearish momentum has intensified following hot U.S. inflation data.

Amid the downturn, the analyst called attention to slowing activity on the XRP Ledger, noting that the network’s daily transaction count has fallen by 20% compared to three months ago. Daily transactions now stand at around 1.78 million, showing weaker participation across the network.

He also highlighted weakness in the derivatives market. According to him, Binance funding rates have moved into negative territory at -0.003. Meanwhile, total liquidations have dropped by 99%, falling to only a few thousand dollars per day.

CryptoOnChain explained that lower transaction activity alongside negative funding rates usually indicates a quiet market with limited interest from traders. He said the drop in network activity shows weaker organic usage, while futures traders appear slightly bearish and continue paying to hold short positions.

XRP Enters Volatility Vacuum

Despite the bearish funding rates, CryptoOnChain said the derivatives market shows encouraging data. He pointed out that Binance’s Estimated Leverage Ratio remains low at 0.173, far below its six-month high of 0.260.

Notably, the 99% collapse in liquidations shows traders are no longer using heavy leverage in either direction. As a result, the analyst believes speculative activity has largely faded from the market. To him, XRP currently lacks the excessive leverage that usually drives sudden squeezes higher or lower.

CryptoOnChain said XRP has now entered what he calls a classic volatility vacuum, where risk appetite remains low, and market participants show little interest. He explained that traders have mostly cleared out leveraged positions, and on-chain activity has also slowed.

According to him, these periods of exhaustion and low liquidity often come before large price swings. He believes the market is now resetting and waiting for a strong macroeconomic or fundamental event to trigger the next major move.

Key XRP Breakout Levels

In a separate analysis, market analyst Ali Martinez also mentioned that technical signals suggest a major move could be close.

Martinez said XRP’s 3-day chart is showing its tightest Bollinger Band squeeze in more than a year. He explained that when volatility tightens this much, the market often sees a sharp price expansion soon after.

$XRP is ready for a big price move!

I’m tracking the tightest Bollinger Band squeeze on the XRP’s 3-day chart in over a year. When volatility compresses this tightly, it’s a signal that a violent price expansion is approaching.

This current compression zone is a definitive… pic.twitter.com/TLBejKAl1D

— Ali Charts (@alicharts) May 18, 2026

According to him, the current range between $1.50 and $1.29 is a no-trade zone. Instead of entering positions early, Martinez said traders should wait for the market to confirm its direction before making moves.

According to him, a clean 3-day candlestick close above $1.50 would confirm bullish momentum and could push XRP toward his main target at $1.80. On the other hand, a close below $1.29 would weaken the bullish outlook and could send XRP down toward the key psychological support level at $1.