As of March 1, 2025, XRP, the cryptocurrency associated with the XRP Ledger, is facing a notable decline in value, currently trading around $2.13. This represents a decrease of 17% in just the last 24 hours and a substantial 31% drop over the past month. This slump has sparked concerns and questions from investors and the XRP community regarding the reasons behind this decline.
The current trading situation reflects a turbulent phase for XRP, with its market capitalization around $24 billion, positioning it as the fourth-largest cryptocurrency after Bitcoin, Ethereum, and Tether. Despite a remarkable 250% increase over the previous six months, the last week has seen XRP lose a significant portion of that value.
Several factors are contributing to the recent downturn in XRP’s price, including ongoing litigation updates, fluctuations in the broader cryptocurrency market, and regulatory uncertainties that have unsettled investors.
One critical reason for XRP’s decline is the ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). Since late 2020, the regulatory scrutiny has created uncertainty surrounding XRP’s classification and future. While there was a partial legal victory for XRP in 2024, which clarified its status for retail sales, the overall legal landscape remains a cloud over its potential growth.
Additionally, XRP’s price depreciation aligns with a wider correction across the cryptocurrency market. A bearish shift in investor sentiment has led to a market-wide sell-off, resulting in a decrease of approximately 6-8% in the global cryptocurrency market cap. This trend has been further exacerbated by the performance of Bitcoin, which has also seen a decline, contributing to the overall negative sentiment.
Another significant factor impacting XRP’s price is the activity of large holders, often referred to as ‘whales.’ On February 3, 2025, approximately 1 billion XRP tokens were released from escrow as part of scheduled monthly unlocks, flooding the market with additional tokens. This surge in supply prompted a swift sell-off that caused XRP’s price to plunge by nearly 25% within a single day.
Furthermore, a marked decline in network activity has been observed, with a dramatic 50% reduction in usage of the XRP Ledger since December 2024. The number of active addresses fell from over 202,000 to just over 101,000, signaling potential bearish implications for future price movements.
The situation has been compounded by profit-taking and liquidation events within the futures market. In late February, over $22 million in long XRP positions were liquidated, indicating that numerous bullish investors were forced to exit their investments, creating intensified selling pressure.
In summary, the recent downturn of XRP’s value is influenced by a combination of ongoing legal challenges, negative market dynamics, significant selling activity by major holders, decreasing network engagement, and liquidation cascades that have collectively contributed to the downward momentum.
From a technical standpoint, XRP is currently testing its lower boundary of support at the psychological level of $2. Many investors are watching closely to see if the price can recover above this level. The resistance levels to watch include $2.51, $2.60, and $2.80, while support exists around $1.80 and further levels beneath.
Looking ahead, several analysts express cautious optimism regarding potential recovery for XRP. Predictions suggest that during March, XRP could trade between $2.15 and $2.40. Some forecasts are even more optimistic, speculating on a possible rise to $3.10 if certain catalysts emerge.
However, several bearish scenarios remain, including further declines if the support at $2.00 fails. Continued selling pressure from large holders could hinder recovery efforts, and negative market indicators may prolong the downturn.
Overall, XRP’s future price trajectory remains uncertain and heavily reliant on multiple factors, from regulatory outcomes to market conditions and investor sentiment.