XRP Consolidates Amid Regulatory and Market Crosscurrents

The price of XRP, the digital asset associated with Ripple, has entered a phase of pronounced consolidation. For several days, its value has oscillated around the $1.90 level, lacking a clear directional bias. The market appears to be in a holding pattern, awaiting fresh catalysts to determine its next significant move. This stagnation persists even as Ripple makes concrete progress in banking infrastructure and the industry anticipates pivotal legislation.

From a chart perspective, XRP is trapped within a narrow trading band. It has repeatedly tested, and held, a support level at $1.88, while facing consistent resistance near $1.94. Trading volume and momentum indicators remain subdued, reflecting a standoff between buyers and sellers.

Analysts suggest that a sustained breakout above the $1.94 ceiling is necessary to fuel a potential advance toward the psychologically significant $2.00 threshold. Conversely, a decisive break below the $1.88 support could trigger a decline toward $1.80, shifting the current consolidation into a corrective phase.

Legal Closure Fails to Spark Rally, Legislative Hurdles Remain

A major overhang for XRP was removed in August 2025 when Ripple and the U.S. Securities and Exchange Commission (SEC) mutually dropped their appeals. This action formally concluded the litigation that began in December 2020, leaving the original 2024 penalty of $125 million in place.

However, the market reaction defied the classic "buy the rumor, sell the news" pattern; instead, the resolution was met with selling pressure. Following the news, XRP retreated approximately 19% from its January peak above $2.17.

CLARITY Act Faces Delays

Potentially more consequential than the settled SEC case is the pending Digital Asset Market CLARITY Act. This legislation would explicitly classify XRP as a non-security, providing long-sought regulatory certainty.

Its passage, however, has hit snags. In mid-January, Coinbase CEO Brian Armstrong withdrew his support, citing concerns over proposed restrictions on decentralized finance (DeFi) and a de facto ban on tokenized securities. With over 130 proposed amendments now on the table, committee deliberations in the House Financial Services Committee have been postponed.

Should investors sell immediately? Or is it worth buying XRP?

Ripple CEO Brad Garlinghouse expressed optimism at the World Economic Forum in Davos, stating, "It will get done. We've never been closer." Nonetheless, more realistic timelines point to a potential enactment by mid-2026.

Ripple Advances Core Banking Strategy

Separate from the regulatory arena, Ripple is building substantive financial utility. In a landmark decision in December 2025, the company received the first-ever national trust bank charter for a cryptocurrency firm from the Office of the Comptroller of the Currency (OCC). This entity, the Ripple National Trust Bank, is designed to hold reserves for the RLUSD stablecoin.

Furthermore, Ripple has applied for a master account with the Federal Reserve. Approval would grant the company direct access to the FedWire and FedNow payment systems, integrating it into the core of U.S. financial infrastructure.

The RLUSD stablecoin itself is experiencing substantial growth. Since its launch in December 2024 with a market capitalization of approximately $72 million, it has expanded to around $1.33 billion. Within this ecosystem, XRP functions as a bridge currency for facilitating cross-border settlements.

Declining Exchange Supply Could Amplify Volatility

A notable on-chain metric with potentially significant implications is the sharp reduction of XRP held on centralized exchanges. Over the past year, these balances have plummeted by 57%, falling from about 4 billion tokens to an estimated 1.5 to 1.7 billion—the lowest level since 2017/2018.

A primary driver of this withdrawal is the launch of spot XRP Exchange-Traded Funds (ETFs) in November 2025, which have absorbed roughly 750 million tokens. This shrinking readily available supply makes the XRP price more sensitive to buying pressure; even moderate demand could now precipitate more pronounced price movements.

Market participants are looking to the near future for directional clues. The upcoming XRP Community Day on February 11, featuring CEO Brad Garlinghouse, is a focal point. Whether this event provides the impetus for a breakout or if the sideways action continues will likely be determined by the token's ability to escape its current $1.88 to $1.94 range.