XRP is trading near $1.38, still 62% below its $3.65 all-time high, and the article argues it could revisit sub-$1 levels if network activity keeps weakening. Daily active XRPL wallets fell to 13,684 from 22,054 a year ago, while new wallet creation and trading volumes have also slowed. Offsetting that, roughly $1.2 billion of cumulative net inflows into spot XRP ETFs and Ripple’s crypto acquisitions could support a recovery if the drawdown is cyclical rather than structural.
The core setup is that XRP has shifted from a pure reflexive token to a hybrid asset with an increasingly institutional ownership base. That matters because ETF flows create a slower, stickier bid that can dampen downside velocity, but they do not fix the underlying issue: if on-chain activity keeps deteriorating, incremental capital will eventually price XRP more like a sponsored momentum asset than a utility token. In other words, the next leg lower would likely be driven less by headline regulation risk and more by a loss of narrative credibility. The second-order risk is that weakening wallet growth can become self-reinforcing. Lower usage reduces developer and ecosystem engagement, which can slow product expansion from Ripple and lower the perceived utility premium embedded in the token; that can compress multiples even if broader crypto remains bid. This is why the threshold around $1 is more psychological than fundamental — the real signal is whether usage stabilizes over the next 2-3 quarters, not whether the price briefly holds a round number. Contrarianly, the consensus may be underestimating how much of the downside is already owned by weak hands and systematic allocators. If XRP breaks lower in a risk-off tape, ETF holders are more likely to be passive than panic sellers, which could limit cascades versus prior cycles. But if the chain metrics keep rolling over into year-end, any bounce is more likely a liquidity event than a durable repricing. For portfolios, the cleaner expression is not outright short XRP spot but volatility-aware downside structures: the asset has enough episodic squeeze potential that linear shorts can be painful, while a structural adoption fade gives you time to monetize. The key catalyst to monitor is whether wallet activity and new-address creation inflect within 1-2 quarters; absent that, rallies should be sold rather than faded into strength.
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mildly negative
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