Fear XRP Could Drop Below $2 Despite Ripple Locking 700 Million Tokens in Escrow | UseTheBitcoin

Fear XRP Could Drop Below $2 Despite Ripple Locking 700 Million Tokens in Escrow | UseTheBitcoin

Several positive actions have failed to stem the XRP price decline, but based on the outcomes of the legal battle, things could change for the better, if not worse.

Apprehension has gripped the XRP community, with looming fear that the token that has been skating on thin ice is moving lower and might soon be trading below the $2.00 mark. When writing, the token was trading at around $2.07.

According to market statistics, the downward volume was increasing, meaning that the bears were raring to increase selling pressure, which could push the XRP price even lower.

Technical analysis shows that since the token hit an all-time high early in 2025, the price of XRP has been slowly descending, with lower highs and lower lows consistently forming. Analysis shows that the resistance levels are continuously declining, with the 200 EMA currently located at around $1.94-$1.95 and representing a significant horizontal support zone from January, which remains the only discernible cushion left for XRP.

Statistics from TradingView show that the $2.00 resistance level has been tested severely, and there doesn’t seem to be a discernible bounce, highlighting the possibility of buyer exhaustion. On the flip side, price charts consistently indicate a rising volume of red candles, showing the sellers are currently in charge of the market. While a casual observer would consider this a standard correction, nothing could be further from the truth. The prevailing situation poses a structural risk to XRP in a short-term bullish situation.

As the token experiences a not-so-good sentiment, a report by Whale Alert has revealed that Ripple has locked 700 million XRP tokens in an escrow account. The move is part of the firm’s long-standing escrow program, which allows the firm to release one billion XRP every month to ensure that the supply of the leading altcoin remains predictable. The firm uses the released XRP tokens to facilitate institutional sales, operational expenses, and other purposes.

While XRP typically releases a portion of tokens into escrow, Ripple CEO Brad Garlinghouse recently hinted at the possibility of the firm reducing its XRP sales in the future, in a situation that could ease pressure on the price of the token. This comes when the XRP community awaits a decision by the SEC following Ripple’s decision to withdraw a cross-appeal against the agency, which agreed to ask Judge Analisa Torres to drop the injunction that has blocked the company from selling XRP tokens to institutional clients.

Contrary to what the broader crypto community expected, the latest move by Ripple hasn’t affected the XRP price, which has mostly stagnated. The newest report from CoinGecko shows that the token lost at least 0.2% of its value in the last 24 hours. While this isn’t completely surprising given XRP’s experience with little volatility due to escrow-related development, most people expected the decisions by the company regarding the legal issues to have created a sort of an impact.

XRP’s lack of strength suggests that a relief rally may be challenging in the short term unless there is significant buying volume. Analysts believe that the $1.94 zone would be the token’s last line of defense if XRP loses the $2 psychological level. Further, in the worst bearish scenario, the token could head as low as $1.70 if a significant reversal doesn’t happen soon.

Ripple is a payment solution used by banks, governments, and institutions. Its primary use cases are cross-border payments, crypto liquidity, and CBDC.

There’s a feeling that XRP’s rising supply could cause downward pressure on its price if demand fails to pick up. Analysts fear XRP risks a further decline to under $2.00 if it validates a Head and Shoulders pattern.

While many people are wondering if there’s any hope for the coin because of the current bearish macro environment and the possibility of a recession looming, investors should know there’s plenty of hope for XRP because of its use cases, growing interest among financial institutions and the looming end of its legal battle against the SEC.

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Daniel Michelson

Daniel is a long term investor and position trader in the forex market.

Reva Green

Reva Green is the Senior Editor for website. An experienced media professional, Reva has close to a decade of editorial experience with a background.

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