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Analysis
Analysis
While XRP’s market price has plunged to a new annual low, breaking below the critical $2.00 threshold, a starkly contrasting narrative is unfolding behind the scenes. Institutional investment vehicles are accumulating the digital asset at a record pace, creating a significant divergence between spot price action and capital flows. This unusual dynamic highlights a battle between macroeconomic fears and long-term conviction.
The immediate pressure on XRP, which recently traded near $1.85, stems from broad macroeconomic anxieties affecting the entire cryptocurrency sector. A primary concern is the potential for a “Yen Carry Trade Unwind.” Yields on 10-year Japanese Government Bonds have surged to their highest level since 2007.
This has fueled market apprehension that an interest rate hike from the Bank of Japan (BoJ) on December 19th could trigger volatility similar to the August 2024 crash, during which XRP lost more than 30% of its value in just five days. Compounding the issue are recent U.S. inflation figures, which have tempered expectations for rapid Federal Reserve rate cuts and placed additional strain on risk assets like cryptocurrencies.
In direct opposition to the weak price trend, data from investment platforms tells a story of sustained institutional demand. According to analytics from SoSoValue, XRP spot exchange-traded funds (ETFs) have achieved a historic milestone since their launch in November:
* Net Inflows: More than $1 billion since trading commenced.
* Consistent Buying: 30 consecutive days of positive inflows.
* Sector Contrast: During this period, Bitcoin ETFs recorded outflows of $2.9 billion, while Ethereum ETFs saw $930 million leave.
Despite high volatility and a price decline of nearly 40% from its 52-week high, major investors appear to be using the downturn as an entry opportunity. The expansion of offerings by financial giants like Vanguard and new products from firms such as Canary Capital supports this thesis of institutional accumulation during price weakness.
From a chart perspective, the short-term outlook remains challenged. The current price trades well below both the 50-day and 200-day moving averages, confirming the prevailing downtrend. However, a historical view suggests such periods of sustained weakness have often preceded major recoveries. Market analysts note that in previous cycles—including 2018, 2021, and 2024—extended periods below the 50-week moving average have frequently been followed by significant bullish rallies for XRP.
The tension between these conflicting signals may soon resolve. The financial world is now focused on tomorrow’s Bank of Japan policy decision and upcoming U.S. economic data. Should the feared monetary tightening in Japan prove milder than anticipated, the substantial foundation of ETF buying could provide the catalyst for a swift price recovery. Until that clarity emerges, the $1.75 to $1.82 price zone stands as the crucial support level that buyers must defend to prevent further declines.
Investors in Cardano (ADA) are facing a period of significant market stress. Despite the project’s development team achieving a key milestone with the launch of the Midnight network, price action tells a contradictory story. A combination of bearish technical signals and a notably cooler market sentiment has exerted substantial downward pressure, erasing crucial support levels.
A look at blockchain data reinforces the pessimistic outlook, with three specific factors weighing on sentiment:
The recent acceleration of the downtrend is attributed to the breakdown of an established trading channel. Market observers note that this structural failure has significantly darkened the technical picture. Over the weekly period, ADA’s price slid by nearly 20%, establishing a new 52-week low at $0.37.
Analysts, including Ali Martinez, are now focusing on lower price targets. Should the selling pressure persist, the zone around $0.29 is viewed as the next significant support area. Indicators like the “SuperTrend” on higher timeframes also suggest this is an extended corrective phase rather than a short-term pullback.
Amid the gloomy price performance, project development continues to advance. The introduction of the NIGHT token for the Midnight network represents a major achievement. Over 4.5 billion tokens are slated for distribution, and major exchanges like Kraken and OKX have already announced listings for the asset.
This activity is visibly impacting the Cardano ecosystem. Trading volume on Cardano-based decentralized exchanges (DEXs) has, in some cases, tripled following the NIGHT launch. This demonstrates active network usage, even if it is not currently reflected in the price of the native ADA token.
Cardano approaches the year-end at a critical technical juncture. If buyers fail to swiftly reclaim the area around $0.38, the risk of a further sell-off toward the $0.29 chart target increases substantially. Only a clear recovery above the 50-day moving average, situated near $0.48, would begin to repair the damaged technical structure—a move that would likely also require a supportive tailwind from a stronger Bitcoin.
The cryptocurrency market’s exuberance has faded considerably since Bitcoin reached its all-time peak in October. The leading digital asset has surrendered approximately 30% from that record high and is now engaged in a struggle to maintain crucial technical levels. Beyond the price action, underlying on-chain metrics and miner revenue data point to a pronounced cooling in fundamental demand, presenting a sobering picture for investors.
The technical outlook remains precarious. Analysts at Glassnode have pinpointed the zone around $81,300 as a critical support level, termed the “True Market Mean.” A sustained break below this threshold could trigger intensified selling pressure. Conversely, any rapid recovery attempt faces a formidable barrier: a massive concentration of supply is noted between $93,000 and $120,000, effectively capping upward momentum.
Market participants are closely watching December 26th, when a significant volume of options contracts is set to expire. A large number of these positions are clustered around the $85,000 strike price. Traders anticipate continued volatility and sideways movement in the lead-up, with the $81,300 level viewed as the bulls’ final defensive line.
A concerning decline in fundamental network health underscores the price weakness. Activity on the Bitcoin blockchain has slumped to a twelve-month low. The 7-day moving average of active addresses has decreased to 660,000—a level not observed since December 2024.
This network lethargy is having a direct impact on miners. Their daily revenue has fallen from an average of $50 million in the third quarter to roughly $40 million currently. The composition of this revenue is particularly telling: it is now almost entirely comprised of the block subsidy. Transaction fees contribute minimally, signaling weak demand for blockchain space and a lack of robust organic usage.
The anticipated year-end rally has yet to materialize. As of Thursday, Bitcoin is trading near $86,700, confined to a narrow range. Traders are noting increased instances of the “Bart Simpson Pattern”—sharp price rallies that are almost immediately met with equally swift sell-offs. A brief breakout toward $90,000 earlier in the week was promptly reversed.
Market observers, including Mike McGlone of Bloomberg Intelligence, caution that October’s surge past $100,000 may have set the stage for a deeper correction. Sentiment has been damaged, with long-term investors divesting an estimated 500,000 Bitcoin since July. While ETF issuers and corporate entities now hold about 13% of the total supply, ongoing institutional inflows are currently insufficient to fully absorb this persistent selling pressure.
While Ethereum’s price faces clear downward pressure, trading near $2,836 with a 24-hour decline of approximately 3.8%, a more profound and potentially bullish transformation is occurring beneath the surface. The proportion of ETH held on centralized exchanges has plummeted to its lowest level in nearly a decade, signaling a significant change in holder behavior for the world’s second-largest cryptocurrency.
Data reveals a striking trend: the Exchange Supply Ratio (ESR), which measures the amount of Ethereum on exchanges against its total supply, has dropped to just 0.137. This marks the lowest reading since Ethereum’s early years nine years ago. Examining specific platforms underscores the movement; for instance, the ESR on Binance alone has decreased from 0.038 in mid-2024 to roughly 0.0325.
Market researchers at CryptoQuant interpret this sustained outflow as an indicator of growing caution among traders and a reduction in immediate selling pressure. The migration of ETH from exchange wallets to private custody is a pattern historically associated with accumulation phases, where investors move assets off exchanges with longer-term holding intentions.
This shift is further amplified by substantial institutional accumulation. Public treasuries and government entities now hold an estimated 6.71 million ETH, valued at around $19 billion. Spot Ethereum ETFs contribute another significant stake, accounting for 6.22 million ETH. When combined with the nearly 36 million ETH currently locked in staking contracts, a vast portion of the circulating supply is effectively in the hands of long-term-oriented participants.
On the network development front, the Fusaka upgrade was successfully implemented on December 3. Its cornerstone innovation, Peer Data Availability Sampling (PeerDAS), allows network validators to verify blockchain data through sampling techniques rather than downloading complete datasets. This advancement is projected to reduce data burdens by up to 85%, significantly lowering the barriers to operating a node.
Concurrently, the network’s gas limit was increased from 36 million to 60 million, enabling a substantially higher number of transactions per block. This enhancement provides direct benefits to Layer-2 scaling solutions like Arbitrum, Base, and Optimism, with developers anticipating associated cost reductions of 40% to 60%.
The current market setup presents considerable danger for leveraged traders. Analysis of liquidation levels shows that if ETH price climbs above $2,971, it could trigger the forced closure of short positions worth approximately $1.3 billion. Conversely, a drop below $2,692 would likely liquidate long positions valued at around $681 million.
This volatility is already manifesting; over the past day, perpetual futures contracts totaling over $162 million have been liquidated, with long positions accounting for roughly $130 million of that sum.
Technical indicators point to continued selling pressure, with the Relative Strength Index (RSI) sitting at 42. While this suggests bearish momentum, it does not yet indicate oversold conditions. The Moving Average Convergence Divergence (MACD) also remains in negative territory.
Despite these price-based signals, Ethereum’s decentralized finance (DeFi) ecosystem demonstrates notable strength. The Total Value Locked (TVL) across Ethereum protocols currently stands at $72.64 billion. The ongoing migration of liquidity and activity to Layer-2 networks is a key factor contributing to the drawdown of exchange reserves.
For a decisive bullish reversal to take hold, Ethereum must overcome a critical resistance zone between $3,025 and $3,050. As long as the price trades below this threshold, the near-term technical outlook remains fragile—even as on-chain data paints a contrasting picture of steadfast accumulation and supply withdrawal.
XRP’s Institutional Backbone Strengthens Amid Market Turbulence
While the broader cryptocurrency market faces significant headwinds, a closer examination of XRP reveals a compelling divergence between short-term price action and deepening institutional commitment.
Market-Wide Pressure Masks Underlying Strength
As of December 18, 2025, XRP is trading near $1.86, having dipped to a low of $1.81 earlier in the day. This represents a 24-hour decline of up to 5%, mirroring a risk-off sentiment across digital assets. The sell-off is largely attributed to macroeconomic factors, specifically rising yields on Japanese government bonds which are fueling concerns over the unwinding of the yen carry trade. This dynamic is pressuring risk assets globally. Bitcoin, for instance, is consolidating around $86,800. Market-wide liquidations have reached $536 million, and the Crypto Fear & Greed Index sits at a score of 17, signaling “Extreme Fear”—a level historically associated with potential market inflection points.
For XRP, the decline in Open Interest suggests a flushing out of over-leveraged positions, with traders reducing exposure and less committed holders exiting.
Unbroken Institutional Demand Tells a Different Story
Beneath the surface volatility, institutional flows paint a starkly optimistic picture. U.S.-listed spot XRP exchange-traded funds (ETFs) have now recorded 30 consecutive days of net inflows since their launch in mid-November. This unwavering demand has propelled assets under management in these products to approximately $1.18 billion.
This trend stands in contrast to competing products; Bitcoin and Ethereum ETFs experienced multiple days of outflows over the same period. The sustained accumulation indicates that institutional investors are strategically adding XRP to portfolios, likely drawn by its established use case in cross-border payments and its relative regulatory clarity. Leading providers facilitating this inflow include Bitwise, Canary Capital, and Franklin Templeton.
Stablecoin Milestone and Strategic Equity Move
Further evidence of ecosystem growth comes from Ripple’s stablecoin, RLUSD, which has surpassed a $1 billion market capitalization. This milestone positions RLUSD among the top five USD-pegged stablecoins by market value—a notable achievement for an asset that entered beta testing only months ago. Its rapid adoption underscores market demand for a compliant, native stablecoin deeply integrated with the XRP Ledger, increasingly used for institutional cross-border settlements and as a bridge to decentralized finance.
In a separate but significant development, a new joint venture between VivoPower and South Korean asset manager Lean Ventures has been finalized with the explicit goal of acquiring $300 million worth of equity in Ripple Labs. This vehicle targets private shares in the company itself, not XRP tokens. The structure is capital-efficient for VivoPower, which will act as the manager and originator rather than the direct purchaser. Over a three-year period, VivoPower aims to generate roughly $75 million in fees and performance incentives through this venture, which is tailored for South Korean institutional and private investors known for their strong affinity for the XRP ecosystem.
The Great Redistribution: Fear vs. Accumulation
On-chain data highlights this market dichotomy. While older wallet cohorts sold into the recent weakness around $1.81, ETF custodians have been consistent net buyers. Daily active addresses remain stable, supported in part by growing RLUSD utility within the network.
The disconnect between “Extreme Fear” in the retail segment and steadfast accumulation by institutional players points to a significant redistribution: coins are moving from short-term speculators to long-term holders.
The current spot price of $1.86 may reflect broad market pressure. However, the foundational infrastructure—$1.18 billion in ETF assets, an unbroken 30-day inflow streak, and a billion-dollar native stablecoin—narrates a story of resilience and maturation far removed from the day’s price chart.