XRP experiences a rapid decline as $25 billion value is lost within a single day

XRPhas experienced a significant price crash, underperforming the general cryptocurrency market, which remains volatile due to the implementation of tariffs by the White House under the administration of Donald Trump.

The recent drop has nullified XRP’s attempt to maintain a price above the $3 mark in order to reach a new all-time high.

At the time of writing, the token was trading at $2.50, reflecting a daily loss of over 15%. On the weekly chart, XRP is down almost 20%. On February 3, XRP experienced a sharp decline of about 40% within 13 hours, before recovering slightly.

This price plunge has been accompanied by massive capital outflows. Currently, XRP’s market cap stands at $138.09 billion, representing a total decrease of $24.97 billion in the last 24 hours. On a weekly basis, the asset has lost $32.96 billion, according to data from CoinMarketCap.

During this trend, whale investors have been actively selling off XRP as the token exhibited signs of weakness. Notably, data shared by prominent on-chain cryptocurrency analyst Ali Martinez in a post on February 3 revealed that whales had sold over 130 million XRP within 24 hours.

It remains to be seen whether the full impact of this sell-off has been realized, as there is potential for increased volatility following Ripple’s release of an additional 1 billion XRP from escrow.

Despite the current bearish movement, long-term sentiment around XRP remains bullish, particularly from a regulatory perspective. There is anticipation that the Securities and Exchange Commission (SEC) will soon make a decision on the Ripple case, which could result in the termination of the legal suit or a settlement in favor of the blockchain company.

Indeed, the resolution of this case could have a significant impact on the asset, especially since XRP’s recent price breakout was partly driven by speculation of favorable regulation under the Trump administration.

Additionally, the regulator is set to decide on an application for an XRP exchange-traded fund (ETF). If approved, the product could attract institutional capital into the asset, with the likelihood of approval appearing stronger due to perceptions of a more positive stance from the SEC.

From a technical perspective, analysis by pseudonymous cryptocurrency trading expert TheGreat Mattsby in a post on February 3 identified key price levels to watch for XRP.

The expert noted that XRP successfully tested the conversion line at $1.98 and the baseline at $1.87 during the monthly timeframe, which serve as significant support zones. These levels, part of the Ichimoku system, define momentum and trend direction.

Currently trading above the $2 level, XRP has pulled back from its recent high of $3.26. If support holds, there is the possibility of a renewed push towards resistance. However, a breakdown below $1.87 could trigger a deeper retracement towards the range of $1.30 to $1.50.

Overall, market sentiment for XRP remains bearish, as indicated by the Fear & Greed Index at 44, signaling fear. The 50-day simple moving average (SMA) of $2.58 suggests that XRP is below its short-term average, indicating a potential extension of the bearish outlook.

However, the 200-day SMA at $1.25 reflects long-term growth potential. The 14-day Relative Strength Index (RSI) stands at 40.02, indicating a neutral position with room for movement, although a short-term downside appears more likely in the immediate future.

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