XRP holdings surge by 1.2 billion in one day: a sign of buying or preparations to sell?

The amount of XRP held by exchanges increased by 1.2 billion units in just one day, attracting market attention, while the price exceeded $3 the next day. Is this a signal for investors to buy, or is it a sign that they are preparing to sell?
There's been some debate about whether this is a signal. Data from CryptoQuant shows that the surge in holdings was driven by large inflows, particularly into exchanges.
Binance increased its XRP holdings from 2.928 billion to 3.538 billion, adding 610 million in one go. Bithumb also increased its XRP holdings to 1.647 billion.
Bybit saw a massive increase from 188 million to 2.519 billion, while OKX saw its number increase from 112,000 to 233 million in just one day.
The increase in XRP holdings on exchanges is generally interpreted as a signal of increased selling pressure, as it increases the likelihood of supply hitting the market. However, this inflow is due to the fact that XRP
Some analysts say that this coincides with the timing of the price reaching the important support line of $2.73, making it difficult to see this as a simple sell signal. Technical indicators such as the Relative Strength Index (RSI) and MACD are showing signs of selling pressure.
This indicates easing, and it has been pointed out that this is not actually intended to sell the market, but rather to secure liquidity in preparation for specific events or to strategically reallocate large holders.
The price movement is also interesting, according to reports. Shortly after the surge in holdings, XRP was hit by the announcement of a weaker-than-expected US Producer Price Index (PPI).
On the 10th, it surpassed $3, up 8.43% on a monthly basis. The buying momentum continued over the weekend. Cryptocurrency analyst Dom said he bought 3 million XRP on the Binance futures market.
This created a chain reaction, generating a net buying pressure of over 10 million shares in 15 minutes. This trend continued throughout the weekend, with Coinbase also selling 8 million shares.
Market analyst Char Steingraber said, "XRP has recovered to $3, but that's actually a fraction of the total trading volume of $6.9 billion."
"Net inflows were only $23.9 million," he said, indicating that despite aggressive buying pressure, high liquidity limited immediate price gains.
Institutional demand is evident in the futures market. CME open interest rose 74% from the previous month to 386 million XRP. Overall futures demand also rose to 7.91 billion.
It increased by 5% in dollar terms, although XRP futures traded at a 7% premium to spot, indicating a balancing leverage.
Nevertheless, other altcoins posted double-digit gains in August.
XRP performed relatively weaker compared to the previous year, suggesting that investors remain cautious, even as expectations of ETF approval continue to support market sentiment.
Cointelegraph reported.