XRP’s Regulatory Milestone Fails to Ignite Price Momentum

The cryptocurrency XRP finds itself caught between significant institutional progress and persistent market weakness. Despite Ripple Labs securing a landmark regulatory approval in the United States, the asset's price continues to struggle, locked in a battle around the crucial $2.00 psychological level.

Market analysts are highlighting several bearish technical signals for XRP. Since July 2025, the price action has formed a descending triangle pattern, traditionally interpreted as a sign of diminishing buying interest. More recently, a so-called "Death Cross" emerged when the 50-day moving average crossed below the 200-day average.

The immediate support level is now seen at $1.96. A decisive break below this threshold could trigger a downward spiral towards $1.78, with a potential extreme case scenario targeting $1.20. Conversely, initiating a trend reversal would require a daily close above the $2.11 resistance.

The broader market sentiment, as measured by the Fear & Greed Index, sits at a level of 23, indicating "extreme fear." However, a glimmer of hope exists in the form of a bullish divergence between XRP's price and its Relative Strength Index (RSI), suggesting selling pressure may be starting to wane.

A Watershed Regulatory Approval

In a pivotal development this week, the U.S. Office of the Comptroller of the Currency (OCC) granted Ripple conditional approval to establish a federal trust bank in New York. The proposed "Ripple National Trust Bank" would operate under direct federal supervision—a first for a cryptocurrency-focused company.

Ripple CEO Brad Garlinghouse hailed the decision as a milestone for the adoption of the company's stablecoin, RLUSD, within the traditional banking sector. This license effectively places a crypto-native project on a level regulatory playing field with established financial institutions.

Despite this fundamental breakthrough, the market reaction has been muted. XRP's price remains largely unchanged, trading around $2.03. This suggests the news may have been already priced in by investors, or that current technical weakness is simply overshadowing the positive regulatory development.

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

Institutional Flows and Expansion Continue Unabated

Institutional interest appears resilient despite the price stagnation. XRP-focused exchange-traded funds (ETFs) have accumulated approximately $975 million in assets since their launch. These products recorded net inflows of $20 million on December 12 alone.

Concurrently, Ripple Labs is aggressively expanding its global footprint. The company has launched a $300 million fund in South Korea. Furthermore, a new partnership with Switzerland's AMINA Bank was announced, with additional European banks expected to integrate the RLUSD stablecoin.

Large Holder Activity Sends Mixed Signals

On-chain data reveals a split in sentiment among major investors, commonly referred to as "whales." Last week, these large addresses sold roughly 280 million XRP tokens, a substantial volume that helps explain the ongoing downward pressure on price.

However, other significant wallets purchased approximately 130 million coins—valued at around $265 million—between December 9 and 12. This activity may indicate a redistribution of assets within the cohort of largest holders.

Network fundamentals remain robust, with the XRP ledger processing a stable 1.8 million daily transactions. The number of active addresses has surged by 142% quarter-over-quarter, signaling growing adoption independent of price movements.

Bridging to New Ecosystems

At the recent Solana Breakpoint conference, Ripple announced plans to develop a technical bridge to the Solana network. The initiative aims to channel liquidity from XRP's $122 billion market capitalization into Solana's decentralized finance (DeFi) ecosystem.

The Path Forward

Fundamentally, XRP's position is stronger than ever, backed by federal regulatory progress, nearly $1 billion in ETF assets, and expanding infrastructure. Yet, the technical outlook remains fragile. The coming days will likely determine whether the $2.00 support holds or breaks. The current disconnect between regulatory success and market performance is unlikely to persist indefinitely.