XRP rises 1.30%: Under Fed pressure, why are the fundamentals strengthening?

XRP has risen slightly by 1.30% in the past 24 hours, currently trading at $1.98, with a high of $2.19. Despite the Federal Reserve maintaining a hawkish stance and the overall crypto market under pressure, XRP remains resilient, supported by multiple factors working together. From institutional allocations and regulatory progress to on-chain demand, the fundamentals are quietly strengthening, laying a foundation for medium-term trends.

Macro Pressures and Market Status

The Federal Reserve signaled a clear cautious stance in early 2026. Federal funds futures indicate a 95% probability of holding the benchmark rate steady in January, with the target range remaining at 3.50%-3.75%. Expectations for the March meeting are similarly conservative, with about a 75% chance of maintaining current rates. This policy environment exerts overall pressure on risk assets, with the total crypto market cap dropping about 2.8% to around $3.13 trillion earlier this week, and XRP’s weekly decline expanding to 5.8%.

In this context, XRP’s ability to hold above the $2.00 key support level and rebound slightly suggests positive internal market structural changes.

Institutional Allocation Forming Medium-Term Support

Ongoing institutional investment remains a key support for XRP. According to the latest data, inflows into US XRP spot ETFs remain stable:

The total net assets of XRP spot ETFs are maintained at $1.52 billion, with ETF net assets accounting for 1.20% of XRP’s total market cap. Even amid recent price pressures, institutional demand via ETF channels remains stable, indicating their long-term valuation outlook for XRP has not fundamentally changed.

Key Support Factors

• Structural demand stability: Institutions continue to allocate through compliant channels, providing technical bottom support
• Optimized entry costs: Recent price retracements offer better entry opportunities for institutions
• Long-term allocation orientation: ETF holders are mostly institutions and long-term investors, with limited selling pressure

Fundamentals Accumulating Catalysts

Progress in regulatory and application layers is providing a more solid fundamental support for XRP.

Regulatory Framework Enhancement

Ripple has received preliminary approval for an Electronic Money Institution (EMI) license from the Luxembourg Financial Sector Supervisory Authority. Coupled with its FCA license in the UK, Ripple is establishing a dual regulatory framework, enabling more efficient cross-border payments, stablecoin applications, and asset tokenization settlements in key European financial markets. Ripple’s president emphasized that the EU, as a leading jurisdiction in establishing comprehensive digital asset regulation, provides certainty that helps financial institutions advance blockchain technology from pilot phases to commercial scale.

Real Asset Application Implementation

Dubai has launched a government-supported real estate trading platform allowing investors to buy and trade real estate shares via blockchain, with XRP directly used as the core settlement tool. This marks the first significant case where high-value real-world assets are split, traded, and settled on-chain in a compliant manner. Leveraging XRP Ledger’s high throughput and low transaction costs, property token transfers and settlements can be nearly real-time, establishing clear real-world financial demand for XRP.

Institutional-Level Holding Plans

Ripple-backed XRP vault entity Evernorth plans to initiate its IPO in Q1 2026 through a SPAC merger to list on NASDAQ. The company holds 388 million XRP tokens, valued at approximately $812 million. This development will further strengthen XRP’s position as a regulated financial asset and build a long-term bridge between traditional finance and the XRP ecosystem.

On-Chain Demand Expansion

Since mid-December 2025, the XRP whale list has added over 25,000 new wallet addresses, setting a new monthly growth record. The total number of XRP-holding wallets has increased from 7.41 million to over 7.51 million, with about 99,000 new addresses added in just the past month. This growth spans all address segments from the top 0.1% to the top 10%, indicating that funds of all sizes are increasing their holdings or entering the market anew.

Significance of Address Growth

• Demand base expansion: New wallets typically mean more users entering the market
• Selling pressure alleviation: Distribution of addresses helps reduce concentrated selling
• Price resilience enhancement: On-chain user base growth provides organic support for prices

Notably, XRP has achieved a key breakthrough in the Australian crypto market, becoming the highest trading volume digital asset on that platform — the first time in nearly four years that XRP has led Bitcoin in trading activity. This reflects a market shift from early speculative phases toward more rational, utility-driven development.

Technical Outlook

XRP has recently shown a consolidation pattern at high levels. After reaching a high of $2.41 on January 5, the price has gradually retraced, currently hovering between $2.00 and $2.20. The $2.00 level acts as a Fibonacci support and aligns with short-term moving averages, maintaining a high-level consolidation structure.

While short-term upward momentum has weakened due to the Fed’s hawkish stance, no trend reversal signals are evident. If XRP can stay above $2.00, there remains potential for a breakout toward $2.22 or even $2.40; conversely, a decisive drop below $2.00 could signal further retracement toward $1.90–$1.80.

Summary

XRP’s modest 1.30% increase reflects a market balancing under macro pressures. Despite the Fed’s hawkish stance exerting pressure on the broader crypto market, XRP’s performance in the following three areas warrants attention:

First, institutional allocation demand remains stable, with ETF inflows providing medium-term support. Second, progress in regulation and application development is accumulating, from EU EMI licenses to real asset settlement applications, with fundamental catalysts gradually strengthening. Third, on-chain demand is expanding, as evidenced by new wallets and increased activity, indicating rising market participation.

In the short term, key support remains at $2.00, and subsequent focus should be on the stability of this level. Medium-term prospects look promising as fundamental catalysts gradually materialize, with XRP potentially breaking out of its short-term consolidation, though the ultimate trajectory still depends on macroeconomic conditions.