Institutional Demand Provides Foundation for XRP Amid Market Uncertainty

The opening trading session of 2026 presents a complex picture for XRP. The digital asset is contending with price action near $1.87, struggling to reclaim the psychologically significant $2.00 threshold. This cautious price movement stands in stark contrast to a powerful underlying trend: sustained institutional capital inflows. Adding to the day's dynamics is the scheduled monthly release of one billion tokens from escrow, a recurring event that focuses market attention on supply mechanics.

A key factor providing underlying support is the anticipated legislative progress of the CLARITY Act. The U.S. Senate is scheduled to begin its markup of the bill in January. The proposed legislation aims to establish clear regulatory frameworks for banks and financial institutions engaging with digital assets. Market participants have cited the expectation of this regulatory clarity as a factor creating a price floor for XRP recently. The hope within the ecosystem is that further legitimization of Ripple's cross-border payment solutions could unlock additional market liquidity.

Spot ETFs Demonstrate Unbroken Confidence

Perhaps the most notable development is the performance of U.S. spot XRP Exchange-Traded Funds (ETFs). Since their launch in late 2025, these funds have recorded not a single day of net outflows. Cumulative inflows have now surpassed $1.16 billion, with total assets under management standing at approximately $1.27 billion.

This consistent institutional demand creates a clear divergence from the wary sentiment prevalent among retail investors. While the broader market's Fear & Greed Index signals "Extreme Fear" with a reading of 20, the steady ETF purchases are seen as a buffer against more severe price declines, even in the face of recent selling activity by some large holders.

Should investors sell immediately? Or is it worth buying XRP?

Monthly Escrow Release Under Scrutiny

As occurs on the first of each month, Ripple has executed the planned release of one billion XRP from its escrow accounts. Historical patterns indicate that typically 70% to 80% of these unlocked tokens are subsequently returned to escrow. For instance, following the December 2025 unlock, the majority of tokens were re-locked, resulting in a net increase of only 300 to 400 million XRP actually entering the circulating supply.

Traders and analysts are closely monitoring on-chain wallet activity today to determine the precise proportion of tokens being re-secured. This figure will provide insight into the potential selling pressure that may reach the open market.

Technical Perspective

From a chart analysis standpoint, XRP is currently trading within a descending channel. Immediate support is identified in the $1.84 to $1.85 range. A sustained bullish reversal would require a decisive break above the $2.05 level, ideally supported by the continuation of strong ETF inflows and positive legislative developments. Conversely, a breakdown below $1.84 could initiate a corrective move toward the $1.77 support zone.