XRP Faces Investor Resolve Amid Market Turbulence

Geopolitical tensions and market volatility are testing the resolve of cryptocurrency investors, with XRP finding itself at the center of the storm. A surprising stabilizing force has emerged from institutional buyers, who are accumulating positions despite sharp price corrections and significant market liquidations driven by a risk-averse climate.

A clear divergence in strategy is visible between large-scale and retail investors. On one hand, network activity has slowed noticeably, and the transaction fee burn rate has plunged by more than 50%. On the other, U.S.-based XRP exchange-traded funds (ETFs) have recorded net inflows of approximately $1.28 billion since November 2025. An additional $57 million flowed into these investment products in the past week alone.

This sustained institutional demand suggests professional market participants are viewing the current price weakness as a strategic buying opportunity, reacting less emotionally to short-term volatility than many private investors. Furthermore, operational developments at Ripple are providing fundamental support. The company recently secured a preliminary e-money license in Luxembourg, a move that strengthens its operational capacity within the European Union even as potential trade barriers loom.

Geopolitical Tensions Trigger Market Shock

The primary driver of recent market instability has been external macroeconomic factors. Announcements from former U.S. President Trump regarding the imposition of 10% tariffs on eight EU nations, effective February 1, 2026, triggered a pronounced "risk-off" sentiment across global markets. XRP's price action has shown a strong correlation with these geopolitical risks, which placed significant downward pressure on its valuation.

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

This market nervousness precipitated a substantial clearing of positions in the derivatives market. Within a 24-hour window, XRP positions worth over $40 million were liquidated. The breakdown of these liquidations was notably lopsided, with roughly 96% representing bets on higher prices (long positions). The swift political escalation evidently caught many traders off guard, accelerating a sell-off that drove prices to an interim low of $1.84.

Technical and Regulatory Hurdles Ahead

From a technical analysis perspective, the situation remains tense. While the support level at $1.84 was initially defended, the asset continues to trade below its key 50-day moving average, situated at $2.01. Achieving a sustained recovery would require XRP to convincingly break through the resistance near $2.10.

Market observers are now closely monitoring two critical developments. The first is the potential response of the U.S. Federal Reserve to the evolving tariff discussion. The second is the ongoing legislative progress of the CLARITY Act within the U.S. Senate. The outcomes of these events are expected to be key determinants of XRP's near-term price trajectory.