Here’s Why The XRP Price Is Still Weak, And Could Crash Further

Overview

The XRP market is currently facing significant challenges, with concerns about a potential price crash looming. This situation arises from increasing selling pressure and a lack of bullish indicators, compounded by a decline in both retail and institutional activity.

Current Market Situation

After experiencing a brief surge above $2 earlier in the year, XRP has struggled to maintain its momentum. The price has remained stagnant around that level, with multiple attempts to break higher proving unsuccessful. Following a recent unexpected spike, the cryptocurrency saw a decline toward $1.95, where it has managed to stabilize and consolidate for several days. This downturn highlights that XRP’s performance remains weak, despite a temporary rally earlier in the year.

The ongoing downtrend in XRP is exacerbated by a notable decrease in institutional participation. Spot XRP exchange-traded funds (ETFs) have recently recorded their second outflow since their inception in November 2025, marking the most significant outflow ever for XRP ETFs. Earlier this year, the first outflow was reported on January 7, which saw $40.80 million exit the investment products. Most recently, another outflow of approximately $53.32 million occurred on January 20. The only issuer to report outflows that day was Grayscale, with over $55.39 million leaving its GXRP ETF, while other products from Canary, Bitwise, and 21 Shares reported no flows. Although Franklin Templeton’s XRPZ recorded inflows of $2.07 million, this was insufficient to offset the overall losses, resulting in a net daily outflow of $53.32 million. Should more outflows occur, the combination of declining institutional activity and XRP’s weakened price could drive the cryptocurrency lower.

Decline in Open Interest

In addition to the drop in ETF inflows, XRP’s Open Interest (OI) has also fallen to new lows, indicating a sharp decrease in trading activity and retail market involvement. Data from Coinglass reveals that XRP’s futures Open Interest fell to $3.35 billion, marking the lowest level since January 1, 2026, when it was recorded at $3.33 billion. A decline in Open Interest is often interpreted as a sign that traders may be losing confidence in XRP’s potential for upward movement. This sentiment may be further influenced by the growing geopolitical and regulatory uncertainties that are causing investors to adopt a more risk-averse approach. The crypto Fear and Greed Index has also entered extreme fear territory, reflecting this cautious mindset among traders.

From author

The current state of the XRP market underscores a troubling trend that could have significant implications for the cryptocurrency’s future. The combination of institutional outflows, declining Open Interest, and overall market uncertainty paints a challenging picture. As traders and investors navigate these turbulent waters, it is essential to monitor developments closely and remain informed about the shifting dynamics that could impact XRP’s performance.

Impact on the crypto market

• Increased selling pressure on XRP may influence broader market sentiment, potentially leading to further declines in other cryptocurrencies.
• The significant outflows from XRP ETFs could deter institutional investments in similar products, affecting overall market liquidity.
• The drop in Open Interest signals reduced trader engagement, which could hinder price recovery efforts for XRP.
• The extreme fear reflected in the crypto Fear and Greed Index may lead to a more cautious approach among investors, impacting trading volumes across the market.
• Ongoing geopolitical and regulatory uncertainties may continue to weigh on market confidence, further complicating recovery efforts for XRP and other cryptocurrencies.