XRP‘s price has fallen under $2 to price levels last seen in April, as selling pressure mounts across both derivatives and spot markets.
According to CryptoSlate data, the Ripple-linked token slipped around 6% in the past day to about $1.87, extending a retreat that has tracked broader weakness in Bitcoin and Ethereum.
Notably, this negative price performance has overshadowed significant milestones that would typically drive bullish momentum for the digital asset.
For context, Ripple recently secured conditional approval from the Office of the Comptroller of the Currency (OCC), putting it on a regulatory footing comparable to that of top-tier financial institutions. Simultaneously, Swiss-regulated AMINA Bank went live with Ripple’s licensed payments product, facilitating near-real-time cross-border transfers.
Beyond banking, Ripple and its XRP ecosystem are expanding to other blockchain networks.
The firm’s $1.3 billion RLUSD stablecoin has broadened support to major Ethereum Layer-2 networks, including Optimism, Base, and Kraken’s Ink. Concurrently, custodian Hex Trust is launching wXRP on Ethereum, Solana, and HyperEVM, opening the path for XRP to enter broader DeFi markets beyond its native ledger.
Interestingly, XRP’s price decline has also defied a record streak of institutional demand. Since launching in November, the US-listed spot XRP ETFs have recorded 22 consecutive days of net buying, accumulating over $1 billion in assets and inflows.
Yet XRP’s price has fallen roughly 17% over the same period, creating a glaring divergence between ecosystem victories, consistent inflows, and adverse spot price action.
This disconnect forces a critical question of “Why is XRP falling despite its fundamental wins?”
The answer lies in three overlapping factors: large-scale profit-taking from early investors, a systemic drop in leverage, and a deep contraction in liquidity. Together, these shifts reveal a market moving from speculation to balance-sheet repair.
Long-term holders cash in
The most immediate source of downward pressure is aggressive distribution by early cohorts who accumulated XRP at prices well below current levels.
For instance, an XRP wallet that is nearly seven years old, which had accumulated the token at around $0.40, realized gains of over $721.5 million on Dec. 11, around the $2.00 level.
The sale came at precisely the moment momentum stalled, reinforcing the resistance rather than absorbing it.
Meanwhile, on-chain data from Glassnode confirms this was not an isolated trade. Profit realization has accelerated since early autumn, with realized gains surging roughly 240% since September.
As a result, daily realized profit has climbed from approximately $65 million to nearly $220 million, even as the spot price trends lower.
This marks a shift in behavior. In previous cycles, long-term holders typically distributed into strength.
However, the current pattern signals a desire for balance sheet protection, with early entrants selling into a fragile market.
This has left XRP’s recent buyers largely underwater. So, there is little natural demand to absorb this supply, resulting in a heavy tape where every round of selling pushes prices to new lows.
Market deleveraging
At the same time, XRP’s derivatives market is stepping away from high leverage.
Data from CryptoQuant shows that Binance’s Estimated Leverage Ratio for XRP has fallen to around 0.18, one of the lowest readings for the current period and a sharp reset from levels seen during the rally above $3.
A falling ELR means a larger share of open interest is now backed by collateral rather than borrowed funds, which usually reflects the closure or reduction of leveraged positions.
This type of deleveraging often follows volatile swings or sharp liquidations, as traders tighten risk and clear out marginal positions. For XRP, the move lines up with the Oct. 10 shock and the subsequent period of choppy price action.
Structurally, lower leverage reduces fragility because fewer positions can be forcibly closed by sudden price spikes.
That lowers the probability of cascade liquidations, which are common during parabolic rallies in altcoins. In the short term, however, it also means there is less speculative fuel on the long side.
With fewer traders willing to take leveraged exposure and long-term holders already realizing gains, the path of least resistance for prices has been lower as the market searches for a new equilibrium.
If liquidity eventually returns to derivatives under these low-leverage conditions, any future upside move may unfold more orderly. For now, the data describes a market that is still rebalancing and has not yet defined its next major trend.
Liquidity drains away from altcoins
Finally, the current crypto market structure completes the bearish picture.
XRP’s weakness is unfolding amid shrinking volumes across the altcoin complex and a renewed concentration of liquidity in Bitcoin.
This shift is evident on Binance, which remains the deepest venue for XRP trading.
According to CryptoQuant data, the Taker Buy Volume in XRP futures, a metric that tracks aggressive buy orders, has dropped from a July peak above $5.8 billion to around $250 million. This represents a 95.7% collapse in active buying, showing how sharply demand has faded.
Over almost the entire period, the Taker Buy Sell Ratio has remained negative, indicating that sell orders have consistently outweighed buys in the derivatives order book.
Moreover, the broader altcoin markets also continue to live in the shadow of Bitcoin’s liquidity pull. As investors crowd into the largest crypto asset, less capital circulates through the rest of the market.
That dynamic has been reinforced by repeated liquidation waves and lingering caution after the Oct. 10 event, which left many traders wary of adding fresh risk.
In this kind of environment, phases of volume compression often end with volatility returning, but the current configuration gives XRP little cushion.
So, with XRP’s buying interest thin and derivatives flow skewed toward the sell side, a deeper correction cannot be ruled out if another macro or market shock hits.
