XRP, the cryptocurrency designed for payment solutions, is facing renewed scrutiny as its recent price action mirrors the turbulent conditions seen during the 2022 market downturn. A sharp weekly selloff, the most pronounced since October 2025, has raised concerns among investors and analysts alike, prompting fears of a potential repeat of the significant price correction witnessed two years prior. This article delves into the factors contributing to XRP’s current predicament, examining on-chain data, market trends, and technical indicators to assess the likelihood of further downside risk.
Underwater Investors and Whale Activity
As of Monday, XRP was trading around $1.60, a significant drop of over 20% from the previous week. This decline has pushed the price below the average cost basis of buyers who entered the market within the last 12 months. According to data from Glassnode, XRP is hovering just above its aggregated realized price, which currently sits near $1.48. This means that a substantial portion of recent XRP purchasers are now holding the asset at a loss, a situation that historically precedes further price declines.
“A decisive break below $1.48 would mean the average holder will be underwater, a setup that closely matches the 2022 bear phase that ultimately ended in a 50% drawdown to about $0.30.”
Adding to the bearish sentiment is the persistent selling pressure from large XRP holders, often referred to as “whales.” CryptoQuant data reveals that the 90-day whale flow remains net negative, indicating that these significant players are distributing their holdings rather than accumulating. This ongoing distribution exacerbates the existing overhead supply, making any potential rebound attempts more challenging.
Stablecoin Outflows and Reduced Buying Pressure
The broader cryptocurrency market is also experiencing headwinds, with stablecoin flows into exchanges turning sharply negative in late 2025. According to CryptoQuant, 30-day net outflows reached approximately $9.6 billion. While these outflows eased slightly in January, they remained negative at around $4 billion, suggesting a continued decline in buying pressure across the market. Fewer stablecoins available on exchanges translates to less capital available for purchasing cryptocurrencies, including XRP, further hindering its ability to break above the realized price and recover lost ground.
Technical Analysis and Potential Price Targets
Technical analysis of XRP’s price charts reveals a crucial support level around $1.43, coinciding with the 100-2W exponential moving average (EMA). This level is closely aligned with the aggregated realized price of $1.48, making it a critical zone for XRP to defend. A breakdown below this level could trigger a more significant selloff, potentially mirroring the events of 2022.
However, the two-week relative strength index (RSI) near 38 offers a glimmer of hope for bullish investors. Historically, similar RSI levels have preceded price reversals, suggesting that XRP may be oversold and due for a correction. If the RSI holds around this level, XRP could spend the coming weeks consolidating before attempting a stronger recovery in late Q1 or Q2 2026.
Conversely, a decisive breakdown below XRP’s 100-2W EMA will likely invalidate the potential recovery scenario.
Should the support at $1.43 fail to hold, XRP risks sliding towards its 200-2W EMA, which currently sits near $1. Such a decline would represent a significant drop of approximately 36% from current levels, echoing the kind of breakdown that followed similar support losses in 2022. Investors should closely monitor these key levels and market indicators to assess the potential for further downside risk.
Source: Cointelegraph
