The Digital Asset Market CLARITY Act has officially landed on the US Senate’s legislative calendar after clearing the Banking Committee by a 15-to-9 vote. For XRP, the bill promises a statutory answer to the question that has dogged Ripple for years: whether the token is a security. Yet the token itself continues to trade under heavy pressure, changing hands at $1.12 and shedding 6.72% on Friday alone. The relative strength index has plunged to 20.3, flagging deeply oversold conditions.
The contrast between political progress and market action could hardly be starker. XRP now sits just above its yearly low and well below key moving averages. A broader crypto rout — the Fear & Greed Index has collapsed to 12, and total market capitalisation has shrunk to $2.18 trillion from last year’s peak of $4.2 trillion — has overwhelmed any positive signal from Washington. The CLARITY Act would enshrine XRP’s non-security status in law, placing it on a regulatory footing closer to Bitcoin and Ethereum. That prospect is a powerful long-term catalyst, but for the moment, it is being priced against a wall of selling.
Behind the price slide, institutional demand tells a different story. Spot XRP ETFs listed in the US attracted $131.94 million in net inflows during May, bringing cumulative flows since launch to roughly $1.4 billion. Seven such funds now manage combined assets of $1.2 billion. The number of wallets holding at least 10,000 XRP has hit a record 332,230, pointing to accumulation among larger holders. Meanwhile, short positions outnumber longs by a ratio of 9 to 1, setting the stage for a potential squeeze if the Senate moves faster than expected.
Yoshitaka Kitao, chief executive of SBI Holdings, described clear US rules as a distinct advantage for Ripple and the broader market. Financial institutions, he noted, are already building infrastructure for custody, settlement and token classification in anticipation of a more defined legal framework.
Should investors sell immediately? Or is it worth buying XRP?
Network usage is also accelerating independently of spot price. Daily transactions on the XRP Ledger rose 35.3% in the first quarter of 2026. The ecosystem for tokenised real-world assets crossed $3 billion in April, and a lively debate has emerged over the role of stablecoins such as RLUSD and USDC. XRP Ledger validator Vet argues that stablecoins complement rather than compete with XRP, bringing activity to the network while XRP remains central for liquidity, predictable fees and auto-bridging.
Standard Chartered, however, has slashed its year-end price target for XRP from $8.00 to $2.80, reflecting the depth of the current sell-off. The broader correction has erased the brief rally to $1.55 that followed the CLARITY Act’s committee passage in mid-May.
For now, the next major trigger lies not in the charts but in the Senate. A concrete vote date has yet to be scheduled. If deliberations advance, XRP could receive the clearest regulatory catalyst it has ever had. If the window closes, the token will have to rely on ETF flows and organic network growth to regain ground. Either way, the gap between what the price says and what the fundamentals suggest has rarely been wider.
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