After a strong start to the year, XRP continues to decline, raising concerns about the $1 threshold—here are the factors putting pressure on its price.

• XRP has fallen sharply from its 2024 peak, raising growing concerns that it may once again drop to $1.
• Whale sell-offs and weak demand near $2 have intensified downward pressure.
• ETF inflows remain strong, but macroeconomic uncertainty continues to limit upside potential.

XRP started the year with strong momentum, but the early optimism quickly faded. In January, the token broke above the $3 mark for the first time in seven years, and then set a new all-time high of $3.65 in July. However, the price trend has since reversed continuously. CoinGecko data shows that XRP has dropped 8.5% in the past week, 12.5% in the past 14 days, nearly 16% this month, and about 26% since December 2024. As selling pressure continues to mount, the risk of XRP returning to the $1 level is becoming increasingly hard to ignore.

Whale Sell-Offs Intensify Downward Pressure

One of the biggest concerns right now is the activity of large holders. According to cryptocurrency analyst Ali Martinez, whale wallets have sold about 1.18 billion XRP over the past four weeks. Such large-scale sell-offs significantly increase downside risk, especially in an already bearish market. When major holders sell during price weakness, it often accelerates the decline rather than stabilizing the price trend.

Weak Demand Near Key Price Levels

Another worrying issue is the apparent lack of strong demand for XRP near the $2 level. Due to the absence of a clear support area, traders are looking for lower entry points, and selling pressure can quickly accumulate. This lack of buyer interest makes the price more vulnerable to declines, even without major negative catalysts.

ETF Inflows Have Not Produced Significant Impact

Interestingly, despite the price drop, XRP ETF and other cryptocurrency ETFs continue to attract capital. Recently, total inflows surpassed the $1 billion mark, indicating that institutional investor interest remains strong. However, these inflows have not translated into upward price momentum. As with other cryptocurrency ETFs, share creation does not always immediately translate into spot trading, which helps explain the disconnect between capital flows and price action.

Macroeconomic Conditions May Determine Future Direction

XRP's near-term outlook may depend on broader market conditions. Ongoing macroeconomic uncertainty and risk-off sentiment have led to heavy selling in cryptocurrency. There are now some signs of potential relief—UK inflation fell to 3.2% in November, the lowest level in eight months, raising market expectations for rate cuts. If the global economic situation improves and risk appetite returns, XRP and other digital assets may get some breathing room. Until then, downward pressure remains the dominant factor.