XRP, the cryptocurrency associated with fintech firm Ripple Labs, declined 7.3% on Tuesday to drop below the $1.30 mark. The move marks a 23% slide from its recent high near $1.68, pushing XRP’s market capitalization to around $81.68 billion. Trading volume over the last 24 hours stood at $4.12 billion.
Price pressure after August surge
After a strong performance in August, where XRP rallied from roughly $1 to almost $1.70 and delivered a 28.5% monthly gain, momentum has reversed. During that period, United States spot XRP exchange-traded funds drew $153.55 million, with most inflows—about $150.28 million—arriving in the final two weeks of the month.
Cryptocurrency analyst Cryptollica noted that XRP’s latest correction resulted in its lowest two-week Relative Strength Index (RSI) reading across the token’s entire 13-year history. Previous market downturns, such as those in 2018, during the COVID-19 turmoil in 2020, and throughout the 2022 bearish cycle, saw less severe RSI levels. Yet, Cryptollica pointed out that the coin continues to find support above its long-term rising trend.
XRP recently posted its lowest two-week RSI value since its inception, surpassing levels seen in 2018, 2020, and 2022 downturns. However, the price remains above its enduring long-term ascending structure, even as investor interest fluctuates.
Investor views and Ripple’s business
Dubai-based investor Royal Kane publicly stated on X that he would not consider buying XRP at current valuations. Kane argued that with a market cap of $81.68 billion, XRP is too large for the type of high return he seeks, preferring lower-cap coins with emerging narratives such as Solana, Pepe, and Zcash.
Kane also asserted that Ripple “has no products or revenue.” In contrast, Ripple currently operates several business segments, including Ripple Payments, RLUSD (its stablecoin initiative), and Ripple Prime, an institutional brokerage established after acquiring Hidden Road.
Mini dictionary: Ripple Prime, an institutional platform for digital asset brokerage, was launched by Ripple after it acquired Hidden Road, aiming to enhance trading solutions for institutional clients.
Federal Reserve rate hike and market impact
On September 16, the Federal Reserve raised its benchmark interest rate by 25 basis points, bringing the target range to 3.75%–4%. This action, the first American rate hike since 2023, was anticipated by markets, which had priced in an 81% chance before the decision. Twelve of the 18 Fed officials signaled further increases may be likely. Higher interest rates bolster the appeal of U.S. Treasury assets when compared to more volatile investments like digital tokens.
Annual inflation in the United States reached 3.4% in August, driven in part by a 3.9% increase in fuel prices. The changing macroeconomic backdrop has contributed to recent weakness in speculative assets, including XRP.
Senate stalls digital asset legislation
On September 15, a Senate cloture vote on the Digital Asset Market CLARITY Act fell short, with 50 senators supporting and 49 opposed—missing the 60-vote threshold by 11 votes. The proposed legislation aimed to split cryptocurrency regulatory powers between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), offering the prospect of greater clarity around XRP’s regulatory status.
XRP maintains its legal standing after a 2023 decision by Judge Analisa Torres determined that programmatic sales of XRP on public trading platforms did not constitute securities offerings. Seven Democratic senators have since announced ongoing negotiations to revive the CLARITY Act, emphasizing that the failed cloture is “not the end.”
Seven Democratic senators have reaffirmed their commitment to advancing the Digital Asset Market CLARITY Act, following a narrow defeat that left the bill short of the Senate’s filibuster threshold.
Across derivatives markets, XRP open interest has fallen from $1.128 billion to $871.22 million in the past month. Meanwhile, Franklin Templeton’s XRPZ ETF brought in $3.5 million in inflows on September 16, marking a ten-day streak of positive flows, while comparable Bitcoin ETFs posted $295 million in outflows over the same period.
| Asset | Open Interest (Recent) | ETF Net Flows (Sept 16) | Aug Performance |
|---|---|---|---|
| XRP | $871.22 million | +$3.5 million | +28.5% |
| Bitcoin (via ETFs) | N/A | –$295 million | N/A |
