Market Volatility and Key Drivers
XRP's market capitalization experienced a significant decline, shedding $13 billion within a 24-hour period. This sharp decrease was primarily influenced by the introduction of the first U.S. spot XRP Exchange Traded Fund (ETF) and substantial selling activity from large holders, often referred to as "whales."
This event underscores the potential for increased volatility associated with new financial products entering the market. It also comes at a time when the broader cryptocurrency market is facing a collective reduction in market capitalization, estimated at around $200 billion.
XRP Market Cap Decline Details
The cryptocurrency XRP has recently seen a notable downturn, with its market cap decreasing by $13 billion over the past 24 hours. This sharp drop occurred concurrently with the launch of the inaugural U.S. spot XRP ETF and significant selling pressure from large XRP holders.
Canary Capital introduced the first U.S. spot XRP ETF, which is known by the ticker XRPC. During this period, substantial XRP holders reportedly sold approximately 1.4 billion XRP, which had a direct impact on XRP's price. As of the time of this report, there have been no official statements released by Ripple's leadership regarding these developments.
Impact on the Broader Cryptocurrency Market
The substantial reduction in XRP's market capitalization contributed to a wider downturn across the broader crypto market, which experienced an overall decrease in market capitalization of approximately $200 billion. The crypto sentiment index also saw a significant drop, indicating a shift towards risk-off behavior among investors in key digital assets.
The launch of the XRPC ETF recorded strong initial performance, attracting net inflows totaling $250 million. However, the impact of selling activities has been more pronounced than the positive reception of the ETF, highlighting ongoing market volatility. This suggests that some large holders may be engaging in profit-taking strategies. As noted by Eric Balchunas, the spot XRP ETF launched by Canary Capital attracted approximately $250 million in inflows on its debut day, positioning it as one of the strongest crypto ETF launches of 2025.
"Canary Capital’s spot XRP ETF attracted approximately $250 million in launch-day inflows, marking one of 2025’s strongest crypto ETF debuts."
Future Outlook for XRP and the Crypto Market
Other major cryptocurrencies, including Bitcoin (BTC) and Ethereum (ETH), also experienced declines exceeding 5%. The current drawdown in the crypto market is intensifying concerns about the potential for extended periods of lower prices.
Historical market behavior around the launch of new financial products, such as ETFs, often includes "sell-the-news" events that can lead to temporary price fluctuations. Consequently, XRP's future price movements are likely to be influenced by the sustained interest from institutional investors. Analysts suggest that these inflows could play a role in longer-term price recovery. For example, JPMorgan estimates indicate that a spot XRP product could attract up to $8 billion in assets under management, with forecasts suggesting a potential price reach of $5 by late 2025 if ETF-driven inflows continue consistently.