Over the past month, XRP has witnessed a notable downturn, shedding approximately 15% of its value. This decline has raised alarms among investors and analysts regarding its capacity to hold critical support thresholds. The cryptocurrency market's inherent volatility, coupled with recent shifts in XRP's on-chain metrics, contributes to an uncertain immediate future for the digital asset.
A crypto chart analyst, Ali Martinez, has underscored the heightened risk of a further price reduction for XRP. This assessment is largely based on a discernible weakening of its on-chain activity and an increase in selling pressure. Specifically, the number of daily active addresses engaged with XRP has diminished from roughly 46,000 to about 38,500, indicating a decrease in user participation. Concurrently, large holders, often referred to as 'whales,' have divested over 40 million XRP tokens in recent weeks, further exacerbating the selling pressure. Martinez suggests that if XRP fails to retain its support level at $1.77, its value could potentially plummet to approximately $0.80.
However, the outlook is not uniformly negative across all market indicators. Cryptoinsightuk, another prominent analyst and trader, has highlighted a recurring pattern in XRP's performance. The weekly stochastic Relative Strength Index (RSI) for XRP has reached zero five times since the market low of 2022. Historically, each instance has been succeeded by a relief rally, with about half of these occurrences marking a cycle low before a rebound. This historical data provides a glimmer of hope for investors looking for signs of a potential recovery.
Despite the technical fragilities, institutional engagement with XRP remains remarkably strong. Niels, a crypto trader, revealed that XRP attracted an impressive $3.314 billion in institutional inflows throughout 2025. A substantial portion of this, $70.2 million, was recorded in just the last week, positioning XRP as a leader in institutional investment among major crypto assets. Data from CoinShares corroborates this, showing that XRP investment products registered $70.2 million in inflows for the week ending December 27, bringing the month-to-date total to $424.8 million. This contrasts sharply with Bitcoin and Ethereum, which experienced outflows of $25 million and $241 million, respectively, during the same period.
Cryptoinsightuk further expressed a continued strong commitment to XRP, attributing this stance to its extended period of consolidation compared to other alternative cryptocurrencies, its recent breakout from an eight-year downtrend, and its demonstrated ability to sustain former seven-year resistance as a new support level. These factors, despite the current price depreciation, suggest a foundational resilience and potential for future growth in the eyes of some long-term investors.
The recent dip in XRP's value has raised pertinent questions about its short-term trajectory, yet a closer examination reveals a more nuanced picture. While some on-chain metrics signal a cautionary trend and potential for further decline, the unwavering institutional interest and historical chart patterns offer a counter-narrative of resilience and impending recovery. The interplay between decreasing user engagement and robust investment inflows paints a complex market scenario for XRP.