Market Downturn and Federal Reserve Influence
The crypto market opened the week with sharp downturns, triggered by the Federal Reserve’s statements reducing the likelihood of a rate cut in December. As a result, XRP witnessed a consecutive four-day value decline. This development followed comments from FOMC members, Lorie Logan and Jeffrey Schmid, who noted that inflation remains above target levels and signaled their unwillingness to support a dovish move shortly. The CME FedWatch data post-announcement indicated a decrease in the probability of a rate cut in December, from 66.9% to 44.4%.
Impact on Bitcoin and XRP
The significant market shifts affected not just XRP but also Bitcoin, which suffered from a two-day net outflow of $1.15 billion from spot Bitcoin ETFs. This pulled BTC below the psychological $100,000 support level, pushing it to six-month lows. While the Nasdaq Index closed the week with a minor 0.45% loss, Bitcoin’s 3.05% and XRP’s 8.05% declines highlighted the high-leverage nature of crypto assets, magnifying market volatility.
XRP ETF Sparks Optimism
However, amidst the downtrend, the XRP landscape saw a promising development. The Canary XRP ETF (XRPC) entered trading on Wall Street, registering a net inflow of $245 million on its first day, making it one of the most successful crypto ETF launches based on 2025’s initial day performance. Analysts anticipate these inflows could transform into XRP purchases in the T+1 process, with price effects appearing later.
Another exciting development for the industry is the countdown for XRP spot ETFs by Bitwise and Franklin Templeton. Franklin Templeton ranks among the world’s top 20 issuers in terms of assets under management. Hence, these new ETFs hold the potential for attracting much stronger institutional demand and differentiating XRP from general market trends.
A similar process was witnessed at the start of 2024 for Bitcoin when prestigious institutions like Harvard Endowment invested in BlackRock’s IBIT ETF, paving the way for Bitcoin’s sharp rise. Analysts are closely observing whether XRP will catch a similar institutional momentum.
Technical Outlook: Key Levels for XRP
XRP fell 3.37% on the last trading day of the week to $2.2444. The four-day decline pushed the price below the 50 and 200-day EMAs, signaling a negative technical outlook. However, should ETF inflows continue, XRP might break the $2.35 resistance and test the $2.50 region in the short term. Sustaining above $2.50 could extend the rally to the $3 level.
On the downside, the $2.20 support is critical. Breaking this level would inevitably bring the $2.00 level back into focus.
Conclusion: Factors Influencing XRP's Future
In conclusion, while short-term pressures on XRP stem from Fed-related factors, the medium-term outlook heavily depends on institutional demand for ETFs. Should Franklin Templeton and Bitwise’s new products launch with strong inflows, XRP has the potential to decouple from Bitcoin and recover towards the $3 band. Nonetheless, the Fed’s approach, regulatory discussions, and Ripple’s bank license process will continue to be key pricing determinants.