XRP just recorded its biggest weekly realized loss increase since 2022, a sign that panic selling may have reached an extreme.
On-chain data shows about $1.93 billion in realized losses in a single week, meaning coins moved to prices below their original buy levels. The last time a loss of that magnitude was recorded, some 39 months ago, XRP rallied 114% over the following eight months.
Realized losses measure actual losses, not paper withdrawals. They rise when holders capitulate and choose to hold losses rather than wait for a rebound. Unlike unrealized losses, which can disappear if the price reverses, realized losses represent final decisions.
That absorption piece matters.
For realized losses to rise into the billions, there must be aggressive selling pressure, but there must also be buyers willing to take the other side. Large capitulation events often coincide with liquidity entering lower levels. Historically, these moments tend to cluster near market bottoms because much of the weaker positioning is cleared out in one move.
When weak hands are washed, the composition of holders changes. The coins that change hands during capitulation typically move from short-term, emotion-driven traders to longer-term buyers with stronger convictions or better cost bases. That redistribution can create a more stable basis for the price.
However, context is key. The 2022 surge came after a prolonged downturn and broader crypto deleveraging. Today’s environment includes macro uncertainty, shifting regulatory narratives, and still elevated volatility across major corporations. A realized loss increase increases the likelihood that sellers are exhausted, but it does not eliminate macro headwinds.
Another variable to watch is follow-up. In previous cycles, sustained recovery required not just a single capitulation imprint, but stabilization in spot demand and declining selling pressure in the weeks following. If realized losses remain high or rapidly accelerate again, this indicates that the distribution has not been completed.
For now, the data points to emotional extremes. Historically, it has been fertile ground for rebounds. Whether it will be a sustainable trend change depends on what happens after the panic subsides.
