The XRP token finds itself in a curious position as 2025 draws to a close. While its underlying ecosystem, Ripple, is achieving significant milestones in expansion and regulation, the price of XRP itself is facing intense downward pressure. This divergence between a deteriorating chart and strengthening fundamentals presents a complex puzzle for market participants.
Regulatory Momentum and Product Expansion
Recent months have seen Ripple make substantial progress on the regulatory front. On December 12, 2025, the U.S. Office of the Comptroller of the Currency (OCC) granted a preliminary, conditional approval for the establishment of the Ripple National Trust Bank in New York. This move brings a regulated U.S. banking structure within reach, a critical component for deeper integration into traditional finance.
The proposed bank is designed to:
* Manage segregated reserves for the RLUSD stablecoin.
* Provide custodial and collateral functions for RLUSD holders.
* Pursue access to a master account with the U.S. Federal Reserve in the future.
Concurrently, Ripple’s native stablecoin, RLUSD, is on a rapid growth trajectory, having surpassed a market capitalization of $1 billion. To accelerate adoption, Ripple plans to deploy RLUSD across four major Ethereum Layer-2 networks: Base (Coinbase), Optimism, Kraken Ink, and Unichain (Uniswap). This strategic expansion aims to embed the stablecoin within core DeFi infrastructure, potentially serving as a bridge between the XRP ecosystem and Ethereum-based applications.
In Asia, institutional engagement is deepening. SBI Ripple Asia has signed a memorandum of understanding with Doppler Finance to explore yield-bearing products based on XRP and the tokenization of Real World Assets (RWAs) directly on the XRP Ledger (XRPL). Notably, this marks SBI Ripple Asia’s first collaboration with a native XRPL protocol, signaling tighter integration between financial institutions and XRP’s infrastructure.
A Technical Picture Under Strain
Contrasting this foundational growth, XRP’s market performance is concerning. The asset is currently trading at $1.86, having decisively broken below the psychologically and technically significant $2.00 level. This breach confirms a bearish trend, with the price establishing a position below this mark for the first time since January 2025.
The decline from its 52-week high of $3.04 represents a drop of nearly 39%. XRP is also trading well below its 50-day moving average of $2.19, underscoring persistent selling pressure. With a Relative Strength Index (RSI) reading of 28.8, the token is technically oversold, which may indicate an exaggerated move but does not guarantee an imminent reversal.
Key technical observations include:
* MACD Histogram: Showing stronger negative momentum, suggesting increasing sell-side pressure.
* Resistance: The zone around $1.93 now acts as the first hurdle for any recovery; a move above approximately $2.27 would significantly improve the technical outlook.
* Next Support: Fibonacci analysis points to the next major support area near $1.63.
* Volume: The price decline is accompanied by rising trading volumes, indicative of active distribution rather than a slip in thin market conditions.
Network Growth Amid Price Pressure
Despite the weak price action, the XRP Ledger’s ecosystem is gaining substantial ground. In 2025, XRPL entered the ranks of the top six largest blockchain ecosystems by market share, which now stands at 4.68%. This represents a dramatic shift from 2024, when XRPL was not a major player in such rankings.
Should investors sell immediately? Or is it worth buying XRP?
On-chain data reveals robust network usage. The transaction velocity metric reached an annual high of 0.0324 in early December 2025, indicating XRP is being actively circulated rather than held statically in wallets. This points to vibrant network activity during one of its most active phases this year.
The behavior of large wallet addresses paints a nuanced picture:
* Long-term holders have increased their share by 3% and now control roughly 11.5% of the circulating supply.
* Approximately 800 million XRP, worth about $1.6 billion, were withdrawn from exchanges in December.
* The number of mega-wallets (holding at least 100 million XRP) has fallen by over 20% in eight weeks, though the remaining large holders have continued to accumulate.
A rising Network Value to Transactions (NVT) ratio adds a note of caution, however. It signals that the market value is growing faster than the value transacted on the blockchain—a classic warning sign that has often preceded potential overvaluation near market peaks.
The CLARITY Act and Institutional Demand
Market observers are closely watching the potential impact of the proposed U.S. CLARITY Act. Ripple CEO Brad Garlinghouse has expressed belief that the legislation could pass in the first half of 2026. The act might compel Ripple to transparently address the future of the 34.4 billion XRP still held in escrow.
While unconfirmed, analyst speculation suggests these escrowed funds could be earmarked for large-scale projects within the global financial architecture, such as:
* International banking corridors.
* Governmental payment infrastructures.
* Liquidity hubs for G20 cross-border payments.
* Institutional frameworks involving entities like the IMF and the Bank for International Settlements (BIS).
On the demand side, institutional products are gaining traction. XRP-focused exchange-traded funds (ETFs) attracted inflows of $1 billion in less than four weeks—the fastest growth rate since the launch of Ethereum ETFs. Unlike previous market cycles, price movements appear less driven by retail speculation and more by gradual accumulation within institutional portfolios, leading to slower but potentially more stable order book flows.
Conclusion: Foundational Strength vs. Technical Fragility
XRP stands at a compelling junction. One path is defined by the breach of key supports, a journey toward 52-week lows, and an oversold yet unbroken downtrend. The other path is paved with tangible growth: XRPL’s ascent into the top-tier blockchains, Ripple’s preliminary U.S. banking license, the expansion of RLUSD, and new institutional partnerships.
In the near term, the technical level around $1.63 is critical as the next major support. For a sustained recovery, the price must reclaim the resistance zone between $1.93 and $2.27. Over the medium to long term, regulatory developments in the U.S., alongside the evolution of RLUSD and real-world XRPL use cases, will determine whether the current downturn is a temporary weakness or the beginning of a prolonged corrective phase.
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