Polymarket assigning a 65% chance of Ripple crashing below $1 has triggered a frenzy.
Naturally, the big question is: How much weight does this prediction actually hold? XRP has been chopping around $1 for nearly two months, with July closing at $1.06. August has kicked off with XRP holding this level, pointing to a clear consolidation phase that has historically set the stage for bullish rebounds.
However, zoom in, and the picture starts to flip. While the monthly and quarterly trends are showing strong resilience, XRP’s weakening competitive edge could explain why the 65% odds aren’t just a fluke. As the chart below highlights, the XRP/ETH ratio is already down nearly 5% this month, extending July’s 13%+ drop, the ratio’s worst monthly loss so far this year.
This shifts the focus to whether August could dethrone July as the XRP/ETH ratio’s worst month this year.
The odds aren’t exactly far-fetched. Ethereum closed July up over 18%, while Ripple managed just a 2.18% gain. That puts ETH’s monthly ROI nearly 10x ahead of XRP, highlighting where investors could chase upside in August. This becomes even more relevant with Bitcoin still hovering around resistance, making rotational flows into stronger-performing assets more likely in the coming weeks.
If this trend continues, the nearly 5% pullback in the XRP/ETH ratio could be just the beginning of a deeper correction. That puts Polymarket’s 65% odds of XRP crashing below $1 back in focus. With rotational flows still weak, can Ripple [XRP] defy the odds and finally turn August into the much-needed comeback month?
XRP faces bearish odds, but key bullish signals are emerging
Looking at the on-chain signals, the test for Ripple bulls is starting to build.
According to CoinGlass data, XRP’s Open Interest (OI) has climbed back to $2.5 billion, returning to mid-July levels. Back then, bulls failed to hold $1.15, triggering a major liquidity sweep as XRP dropped to $1.03 in early August, while OI fell to $2.36 billion. In essence, leverage is building back up, putting more pressure on the $1 support. If bulls fail to hold it again, another sharp liquidity sweep could be on the cards.
That said, the fundamentals can’t be ignored. As the analyst highlighted in the post below, XRP’s deflationary tokenomics remain one of its stronger fundamental points among major L1s. Over the past 206 days, XRP’s total supply has dropped from 99,985,726,061 to 99,985,630,555, meaning 95,506 XRP have been burned, roughly 463 XRP per day.
Meanwhile, XRP Ledger’s 7-day average active addresses are up 8.1% over the past week, averaging 15.2k daily. Together, the rising network activity and steady XRP burns give bulls some fundamental support, even as price action remains weak.
However, with XRP losing ground against ETH and leverage building back up, these burns look less like a routine reduction and more like a strategic intervention, highlighting the underlying technical pressure. In other words, the burns could be helping protect holder value while the token struggles to regain momentum.
In this setup, Ripple isn’t fully bullish just yet. If smart money doesn’t step in, another July-style liquidity sweep remains a real possibility, keeping Polymarket’s 65% odds of XRP falling below $1 firmly in focus.
