The XRP price today stands at $2.77, marking a significant intraday drop of 11.27%. Over the past week, the digital asset has declined by 14.05%, raising concerns among investors and traders alike. With such sharp volatility, many are asking: Why is XRP dropping today? And more importantly, when will XRP go up again?
This article explores the core factors behind XRP’s current downturn—ranging from ongoing legal battles to macroeconomic pressures—while also analyzing future catalysts that could spark a recovery. By understanding both the challenges and opportunities, investors can make more informed decisions in this evolving market.
Ripple vs. SEC: Ongoing Legal Uncertainty Weighs on XRP
One of the most persistent influences on XRP price movement is the long-standing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC). While Ripple achieved a partial victory in July 2023—when a federal judge ruled that XRP is not a security when sold to retail investors—the case remains unresolved in key areas.
Specifically, the court found that certain institutional sales of XRP violated securities laws, leaving regulatory ambiguity for exchanges and institutional investors. This gray area continues to impact market sentiment and limits broader adoption.
Stuart Alderoty, Ripple’s Chief Legal Counsel, is scheduled to speak at XRP Community Day on January 28, where he will address the lawsuit’s current status, tokenization trends, and Ripple’s regulatory roadmap for 2025 and beyond. Market participants are closely watching for any strategic shifts or clarity on future compliance efforts.
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Furthermore, an important cross-appeal brief deadline is set for April 16, which could shape the final outcome of the case. Until then, legal uncertainty will likely remain a drag on investor confidence, contributing to short-term bearish pressure.
Macroeconomic Pressures: FOMC Meeting 2025 and Risk-Off Sentiment
Beyond project-specific issues, broader macroeconomic forces are also weighing heavily on XRP and the wider crypto market.
The upcoming Federal Open Market Committee (FOMC) meeting on January 28–29, 2025, has intensified market caution. Strong U.S. economic data suggests the Federal Reserve may delay interest rate cuts, maintaining higher borrowing costs for longer. In such environments, risk-on assets like cryptocurrencies often face selling pressure.
This shift in sentiment is reflected across markets: U.S. stock futures dropped 2.15% ahead of the meeting, and capital began rotating into safer assets. As a result, even fundamentally strong projects like XRP are experiencing downward momentum.
Investor Behavior Amid Market Predictions
Adding to the anxiety is a high-profile market crash prediction from Robert Kiyosaki, best known for Rich Dad Poor Dad. He has warned of an impending financial collapse in February 2025, urging investors to protect their wealth through Bitcoin, gold, and silver.
While Kiyosaki doesn’t specifically target XRP, his warnings amplify risk-averse behavior across digital assets. In times of uncertainty, investors often favor Bitcoin as “digital gold,” leaving altcoins like XRP more vulnerable to sell-offs.
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Despite its utility in cross-border payments and asset tokenization, XRP cannot fully insulate itself from systemic macro trends. Until there’s clearer direction from central banks or improved risk appetite, near-term price action may remain subdued.
When Will XRP Go Up? Key Catalysts for Future Growth
While current conditions are challenging, several positive developments suggest that XRP could rebound in the medium to long term.
Potential Tax Advantages for U.S. Crypto Projects
Businessman Eric Trump recently highlighted that U.S.-based crypto initiatives like XRP and HBAR might benefit from a proposed zero capital gains tax policy. If implemented, this would make domestic crypto investments significantly more attractive, potentially increasing demand for compliant projects like Ripple.
Such a policy shift could boost investor sentiment and drive inflows into XRP, especially from retail and institutional players seeking tax-efficient exposure.
Regulatory Support Gaining Momentum
Political momentum is also building in favor of crypto-friendly reforms. Senator Ted Cruz has announced plans to overturn IRS rules that classify DeFi participants as brokers—a move that could reduce regulatory overreach and foster innovation.
If passed, this legislation would create a more favorable environment for blockchain development in the U.S., benefiting projects like Ripple that operate transparently and engage proactively with regulators.
Ripple’s Strategic Advancements in Tokenization
Ripple continues to expand its footprint in asset tokenization—a growing sector expected to reach $16 trillion by 2030 according to industry estimates. The company’s recent partnership with U.K.-based asset manager abrdn demonstrates its ability to bridge traditional finance with blockchain technology.
Additionally, Ripple has committed $3.8 billion to a liquidity fund aimed at supporting ecosystem growth and ensuring stable market conditions for XRP. These initiatives underscore Ripple’s long-term vision and technical capabilities.
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Frequently Asked Questions (FAQ)
Q: Why is XRP dropping today?
A: XRP is declining due to a mix of legal uncertainty around the SEC case, bearish macroeconomic conditions ahead of the FOMC meeting 2025, and broader risk-off sentiment in financial markets.
Q: Is XRP a good investment right now?
A: While short-term volatility persists, XRP shows strong long-term potential due to its use in cross-border payments, asset tokenization, and growing regulatory engagement. Investors should assess their risk tolerance before entering.
Q: Will XRP ever recover?
A: Yes, many analysts believe XRP can recover once legal clarity improves and macroeconomic conditions stabilize. Catalysts like favorable tax policies or ETF approvals could accelerate a rebound.
Q: What is the significance of the April 16 deadline in the Ripple vs SEC case?
A: April 16 marks the deadline for a key cross-appeal brief in the ongoing litigation. The filings could influence whether either party seeks further review, impacting market perception of regulatory risk.
Q: Could an XRP ETF be approved in the future?
A: While no official ETF has been filed yet, increased regulatory clarity—especially post-lawsuit—could pave the way for future ETF applications, similar to Bitcoin and Ethereum products.
Q: How does the FOMC meeting affect cryptocurrency prices?
A: When interest rates stay high or rate cuts are delayed, liquidity tightens. This reduces investor appetite for risky assets like cryptocurrencies, often leading to sell-offs across the market.
Final Thoughts
XRP’s current downturn reflects a confluence of legal, economic, and psychological factors. While the $2.77 price level may test investor patience, the underlying fundamentals of Ripple’s technology and strategic positioning remain robust.
As we move through 2025, developments such as resolution of the SEC case, potential tax reforms, and advancements in tokenization could reignite bullish momentum. For now, patience and informed decision-making are key.
Staying updated with credible sources and monitoring macroeconomic indicators will help investors navigate this volatile phase—and position themselves for future gains when market conditions shift.