XRP (XRP) fell over 13% this week and nearly 41% from its yearly high, with market cap shrinking from $145 billion to roughly $85.5 billion. Multiple metrics now point to an increasing risk of the asset breaking below the psychologically critical $1 level.
Network Activity Fades: TVL Halved, Revenue Drops Sharply
Data from DeFiLlama shows that total value locked (TVL) on the XRP Ledger dropped from $80.5 million in early January to $48.5 million – a decline of nearly 40%. The figure stands even lower against the $120 million peak seen around mid-July last year. Weekly chain revenue has also fallen to roughly one-third of what it was in September 2024, signaling weakening user demand for the network.
Derivatives Turn Bearish: Negative Funding Rate
Futures market data reveals traders are unwinding positions. Open interest is declining, and the weighted funding rate has turned negative. A negative rate indicates that short-leveraged traders dominate, a setup that often reinforces spot selling pressure and accelerates the downward trend.
Institutional Demand Stalls: Spot ETF Inflows Plummet to $39M
After a strong launch, spot XRP ETF inflows have dried up. SoSoValue reports only $39 million in net inflows over the past week, far below the $200 million weekly pace during the product's initial weeks. The absence of institutional buying removes a key support pillar that typically cushions bearish moves.
Technical Picture: Descending Channel and $0.78 Support
On the daily chart, XRP has been trapped inside a descending parallel channel since mid-July last year. As long as it remains within this pattern, the downtrend is intact. The price has already broken below the Murrey math major support/resistance pivot at $1.56. The next target is the strong pivot reverse at $1.17. If that level fails to hold, the ultimate support sits at $0.78 – a further 44% drop from the current price. The MACD lines are pointing downward, adding to the bearish technical evidence.
With on-chain demand weakening, derivatives sentiment shifting, and institutional interest cooling, XRP faces a multi-front challenge. Whether the $1.17 level holds will likely determine the near-term direction.