XRP posted one of its steepest declines of 2026 on Feb. 5, tumbling 15% in 24 hours to an intraday low of $1.22. The move marked a drawdown of more than 45% from its Jan. 6 peak of $2.40, effectively wiping out a large portion of the gains the token had built since late 2024. Even after trimming part of the drop and trading near $1.26 later in the session, XRP remained under heavy pressure as broader crypto markets sold off.
The decline also carried a major impact on valuation. XRP’s market capitalization fell to roughly $80 billion, its lowest level since late 2024, according to the cited market data. Over the previous seven days, the token had already lost nearly 30%, placing it among the weakest performers in the large-cap digital asset segment during the period.
Sharp spot losses spilled into derivatives
The violent move in the spot market quickly triggered a wave of forced unwinds in leveraged trading. The report said XRP’s downturn resulted in approximately $43 million in long liquidations and about $4.2 million in short liquidations. Such liquidation imbalances often intensify directional moves, especially when a large share of traders are positioned on one side of the market and risk management thresholds are breached in rapid succession.
XRP started the day trading above $1.50 before sliding sharply as selling spread across digital assets. Bitcoin also dropped to its lowest level in more than a year during the broader market retreat, underscoring that XRP’s weakness was unfolding within a wider risk-off environment rather than in isolation. Still, XRP’s losses were noticeably deeper than many peers, suggesting additional token-specific pressure in both sentiment and positioning.
Why XRP fell harder than many other altcoins
According to Ryan Lee, chief analyst at Bitget, the sell-off was not driven by a single fundamental breakdown. Instead, he described the move as a technically driven deterioration amplified by short positioning and weakening liquidity. In his view, the loss of important support zones changed the chart structure and opened the door to a bearish continuation pattern, making the market more vulnerable once sellers overwhelmed available buying interest.
Lee said two factors appear to have accelerated the decline. First, leveraged positioning and elevated short exposure compressed price action and turned what may have been a normal pullback into a much steeper slide. Second, a broader macro backdrop shaped by geopolitical risks and interest-rate uncertainty has reduced investor appetite for higher-beta crypto assets. In this setting, market participants often rotate toward assets perceived as relatively safer, such as bitcoin or gold, leaving tokens like XRP more exposed during periods of repricing.
The report’s framing suggests that XRP was hit by the interaction of technical weakness and macro caution. Once support levels failed, the market lost a key anchor. As liquidity thinned and bearish positioning increased, downside momentum became easier to sustain. That combination can be especially punishing in crypto markets, where leverage and sentiment shifts often magnify otherwise ordinary directional moves.
Sentiment on social media added to selling pressure
Beyond chart signals and derivatives activity, the report noted that bearish commentary on social media may have worsened XRP’s decline. Some influential accounts urged holders to exit positions immediately. While many observers reportedly dismissed those posts as alarmist, the circulation of strongly negative messaging can still affect trader behavior, particularly in already fragile conditions. When confidence is weak, social media narratives can contribute to faster sell-offs by reinforcing fear and encouraging momentum-driven exits.
This dynamic appears to have mattered because XRP was already trading in a market dominated by declining risk appetite. In such an environment, even marginal shifts in sentiment can have an outsized effect. Once panic or urgency begins to build, traders using leverage may rush to reduce exposure, while spot holders may sell preemptively to avoid deeper losses. That feedback loop can push prices lower in a short period of time, which in turn triggers additional liquidations and further deteriorates sentiment.
ETF inflows were not enough to stabilize the market
One notable aspect of the episode is that net positive inflows into XRP spot ETFs were reportedly not enough to stop the downward move. Under different market conditions, positive ETF demand could have offered a counterweight to selling pressure by signaling continued institutional or structured-product interest. In this case, however, the broader market decline, the breakdown in technical structure, and the aggressive derivatives flush appear to have overwhelmed that support.
This disconnect highlights an important point for traders and investors: positive flow data does not always translate into immediate price stability. When markets are repricing risk across the board, even constructive signals may be ignored in the short term. Price action can remain driven by liquidity conditions, forced selling, and shifts in macro expectations rather than by any single supportive indicator.
What the move says about the current market backdrop
XRP’s drop offers a snapshot of how fragile crypto sentiment can become when several pressures hit at once. The token lost more than 45% from its January top, suffered a 15% one-day crash, and saw tens of millions of dollars in leveraged positions wiped out. The episode also reinforced that large-cap altcoins may underperform sharply when bitcoin weakens and investors become more defensive.
For now, market attention is likely to remain focused on whether XRP can rebuild support after falling below key technical levels. Traders will also watch whether the broader crypto market stabilizes, especially if bitcoin finds a floor after its own sharp decline. If risk sentiment remains weak, higher-volatility assets may continue to face outsized pressure. If market conditions improve, however, the severity of the recent move could also make XRP a closely watched asset for any sign of a technical rebound.
At this stage, the reported facts point to a sell-off shaped by multiple reinforcing forces: broken support, heavy liquidations, macro risk aversion, and negative social sentiment. Taken together, they explain why XRP’s decline was not merely another down day, but one of its harshest drawdowns of the year.