XRP’s Market Contradiction: Record Network Activity Amid Price Decline

January 2026 has presented a challenging landscape for XRP, with its price experiencing significant downward pressure. The digital asset, which reached a monthly peak of $2.36 on January 5th, saw its value retreat to approximately $1.94 by January 22nd. This represents a decline of nearly 19% over the period. This price action has fostered a notable divergence: while retail sentiment has turned deeply negative, on-chain metrics are hitting records, institutional products are attracting capital, and leadership remains bullish.

Contrary to the falling spot price, institutional investment vehicles continue to gather substantial inflows. The spot XRP Exchange-Traded Funds (ETFs), launched in November 2025, have now accumulated over $1.23 billion in assets. Since their inception, these funds have recorded net outflows on only two days, with total assets under management standing at roughly $1.39 billion.

Notably, ETFs from providers like Bitwise, Grayscale, and Franklin each attracted approximately $50 million in inflows during January alone. This institutional accumulation is reflected in exchange balances. The supply of XRP held on centralized exchanges has plummeted to its lowest level since 2018, dropping from 3.76 billion tokens in October 2025 to about 1.6 billion by late December. Analysts note that ETF purchases alone have removed over 780 million XRP from the available market supply.

Retail Fear Contrasts with Surging Network Use

Data from analytics firm Santiment points to "extreme fear" within the social media environment surrounding the world's fifth-largest cryptocurrency. Retail investors have largely stopped buying the dip, with many withdrawing from the market. Historically, however, such periods of pervasive pessimism have frequently marked cycle lows, as crypto markets often move contrary to crowd psychology.

This sentiment stands in stark contrast to actual blockchain usage. On January 13th, the XRP Ledger processed 1.45 million transactions in a single day—a six-month high. Network activity has been on a consistent upward trajectory since the end of 2025, driven by increasing adoption in cross-border payments, tokenized assets, and decentralized finance (DeFi) applications.

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

Leadership Bullish on Regulatory and Product Milestones

At the World Economic Forum in Davos, Ripple CEO Brad Garlinghouse expressed significant optimism on January 21st. "I am very bullish and predict we will see an all-time high," he stated. He highlighted the GENIUS Act, passed in June 2025, as a key catalyst. This legislation establishes clear regulatory frameworks for stablecoins, mandating full reserve backing and monthly audits.

Garlinghouse also emphasized the importance of the legal resolution with the U.S. Securities and Exchange Commission (SEC), a case settled in March 2025 at a cost of $150 million to Ripple. He views this settlement as providing crucial regulatory clarity. This outlook is echoed by analysts at Standard Chartered Bank, who project XRP could reach $8 in 2026 and advance to $12.50 by 2028.

In a significant development for Ripple's stablecoin, RLUSD achieved a major listing on Binance on January 22nd. The world's largest crypto exchange now offers trading pairs for RLUSD/USDT, RLUSD/USDC, and XRP/RLUSD, accompanied by a fee-free promotion designed to boost liquidity.

Concurrently, the firm Evernorth announced plans to establish a $1 billion institutional XRP treasury, which will be managed by AI-powered agents operating on the XRP Ledger.

Technical Perspective

From a chart analysis standpoint, XRP remains confined within a descending channel. A decisive breakout above the $2.42 level could potentially open a path toward $3.00. Interestingly, the Money Flow Index has begun to rise from oversold territory even as the price continues to decline—a bullish divergence that often signals waning selling pressure. The coming weeks will determine whether the current correction represents a buying opportunity or if the broader downtrend will persist.