XRP crashes 12.5% in TVL, ETF delay and war fears trigger selloff

• XRP Ledger TVL dropped 12.5% to US$54.2 million.
• Open interest fell 36%, funding rates turned negative.
• Death cross and descending triangle indicate more downside.

XRP is facing renewed downside pressure as a combination of geopolitical instability, regulatory uncertainty, and weakening network metrics push the token closer to a critical breakdown.

The cryptocurrency, once buoyed by optimism surrounding a possible XRP ETF and Ripple’s courtroom wins, is now testing major support near the $2 mark. However, XRP has rebounded slightly and is now up by 3.34%, trading at $2.02.

With bearish technical formations in place and key indicators flashing red, analysts suggest the next move could drag XRP down toward $1.47—or worse.

ETF delay and macro risks hurt sentiment

Investor confidence took a hit after the US Securities and Exchange Commission postponed its decision on the Franklin Templeton spot XRP ETF.

This marked the latest in a series of regulatory setbacks for crypto assets in the US, fuelling speculation that XRP’s institutional adoption may take longer than expected.

The delay, announced last week, coincided with rising geopolitical tensions in the Middle East. As fears of a broader conflict mounted, Bitcoin and other major altcoins were caught in a widespread risk-off move.

XRP was particularly affected, entering one of its longest losing streaks in over a month.

This double blow—the ETF delay and broader crypto selloff—triggered a rapid loss of momentum, with XRP now trading just above its crucial $2 level. Today’s move above $2.00, however, signals a short-term bounce that traders are watching closely.

On-chain metrics flash weakness

Network data is showing signs of deterioration.

Total value locked (TVL) on the XRP Ledger has dropped approximately 12.5% to US$54.2 million, indicating reduced participation and weakening decentralized finance activity.

This decline has cast doubt on XRP’s use-case strength, especially as competing networks show more resilient metrics under similar market conditions.

Open interest in XRP derivatives has also plunged by nearly 36%, with funding rates turning negative. These data points suggest traders are shifting to a more bearish stance, expecting lower prices ahead.

XRP is displaying a descending triangle pattern on technical charts—often considered a bearish signal—alongside a “death cross” where the 50-day moving average dips below the 200-day average.

Support zones and possible downside targets

According to technical analyst EGRAG Crypto, the $2.10–$2.09 range had served as a major support level aligned with the 200-day moving average.

But repeated tests have weakened this zone, making a decisive break more likely.

If XRP fails to hold above $2, the next demand zone sits between $1.90 and $1.77.

A further breakdown could see XRP testing the $1.47 support level, and in the worst-case scenario, analysts warn of a sub-$1 drop if panic selling sets in.

But with today’s recovery to $2.02, the $2 mark may hold for now, at least temporarily delaying this downside path.

ETF hopes and bounce arguments remain

Despite the bearish setup, some market participants remain optimistic. XRP recently showed a quick V-shaped recovery from around $1.91 to reclaim the $2 level, backed by roughly US$4 billion in futures trading volume.

This bounce, while short-lived, demonstrated that there is still demand at lower levels.

CasiTrades, a well-followed trader, has suggested that a successful defence of the $2 level could open up a path toward $3, especially if volume holds and macro news improves.

Meanwhile, event-based prediction platform Polymarket shows more than 80% odds for a spot XRP ETF approval later this year, giving bulls a potential catalyst to look forward to.

With XRP now trading at $2.02, attention is back on whether this bounce has enough volume and momentum to push further upward—or whether sellers will return around this level.

Outlook hinges on technicals and regulation

XRP is now at a crucial inflection point. If the $2 support level fails to hold, downside risks could accelerate, potentially taking the price toward $1.47 or lower.

On the other hand, holding above $2 amid improving ETF sentiment and calming geopolitical tensions could set the stage for a reversal toward $2.30–$2.33 and beyond.

Market watchers are advised to monitor ETF news closely, particularly from the SEC, while keeping an eye on network metrics and price behaviour around key support levels.

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