XRP’s Underlying Strength Emerges Amid Price Volatility

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While XRP's price experienced a notable pullback in Thursday's trading session, a closer examination of its core metrics reveals a robust and growing ecosystem. The digital asset declined from $2.15 to $2.07, marking a 3.7% drop, yet this short-term price action stands in stark contrast to several bullish fundamental developments.

A significant pillar of support for XRP comes from sustained institutional interest. Spot exchange-traded funds (ETFs) dedicated to the asset have recorded cumulative inflows reaching $1.26 billion, without a single day of net outflows. These funds now hold over 780 million XRP tokens, representing nearly $1.6 billion in assets under management.

Concurrently, the supply of XRP held on centralized exchanges has plummeted to its lowest level in eight years, falling below 2 billion tokens. Data from Glassnode indicates a sharp reduction from 3.76 billion in October 2025 to approximately 1.6 billion by the end of December. This tightening of available supply, against a backdrop of increasing utility, is viewed by market strategists as a classic precursor for potential price appreciation.

Network Activity Hits a Six-Month Peak

On January 13, the XRP Ledger processed 1.45 million transactions, achieving its highest daily count in 180 days. This surge in on-chain activity suggests expanding adoption for cross-border payments, tokenized assets, and decentralized finance (DeFi) applications, despite the recent price weakness.

Historical patterns show that such divergences, where network usage grows independently of price, have often preceded substantial rallies. A similar disconnect was observed in Q3 2020, when daily transactions rose more than 40% while XRP traded around $0.25. The asset subsequently climbed above $0.70 within weeks.

Regulatory Landscape Gains Clarity in Key Markets

The regulatory framework for XRP continues to evolve favorably. Ripple recently secured a preliminary e-money license in Luxembourg, a move that would facilitate digital asset payments across the European Union. The company is also pursuing a CASP (Crypto-Asset Service Provider) license under the upcoming MiCA regulations.

These developments follow the August 2025 settlement with the U.S. Securities and Exchange Commission (SEC), which confirmed that XRP is not considered a security when traded on secondary markets. This regulatory progress helps reduce a longstanding overhang on the asset.

Technical Resistance and Trading Dynamics

During the recent session, XRP faced persistent selling pressure around the $2.13 price level. A notable volume spike occurred during the U.S. trading hours at 15:00 UTC, with 102.7 million tokens changing hands—133% above the daily average. The selling pushed the price to an intraday low of $2.06 before a minor recovery to $2.07.

Total trading volume contracted to $2.81 billion, a decline of over 30% from the previous day. XRP's current market capitalization stands at $125.85 billion. The immediate technical hurdle remains the $2.13 to $2.26 zone. A convincing breakout above $2.13, supported by strong volume, could pave the way toward the $2.30-$2.40 range. Conversely, a drop below $2.05 may lead to a test of the psychologically significant $2.00 support level.