Why XRP Price May Plunge Below $1 Soon: Key Factors and Technical Analysis
XRP’s price has been on a significant downward trajectory, sparking concerns among investors about a possible crash below the $1 mark. After breaking below the critical support level at $2, the token has now experienced its longest losing streak in over a month, trading at levels unseen since early April. Below are the main reasons behind XRP’s recent decline and what technical chart patterns reveal about its near-term prospects.
Current Market Status
As of June 23, 2025, XRP is trading around $2.19, having dropped more than 40% from its yearly high observed earlier in the year. This depreciation marks a sustained downtrend that began in January, when XRP was priced near $3.40. The recent price action is accentuated by XRP falling below two key moving averages — the 50-day and 200-day exponential moving averages (EMA) — which traditionally indicates bearish momentum.
Three Key Factors Driving the XRP Price Decline
1. SEC Delay on the Franklin Templeton XRP ETF Decision
A significant blow to XRP came last week when the U.S. Securities and Exchange Commission (SEC) postponed its ruling on the Franklin Templeton XRP Exchange-Traded Fund (ETF), requesting additional time for analysis. Such delay heightened uncertainty among investors, contributing to the recent sell-off. Nonetheless, optimism remains among some traders, as market sentiment polls like Polymarket indicate over an 80% probability that the SEC will approve a spot XRP ETF before the end of the year.
2. Broader Crypto Market Turmoil Amid Geopolitical Tensions
The broader cryptocurrency market has experienced a downturn triggered by escalating geopolitical tensions in the Middle East. This unrest has caused corrections in major cryptocurrencies, including Bitcoin, and pushed many altcoins, XRP included, deeper into bear market territory. Such external shocks often erode investor confidence and liquidity, disproportionately affecting smaller or mid-cap coins.
3. Underperformance in the Decentralized Finance (DeFi) Sector
On-chain data reveals XRP Ledger’s continuing struggles within the DeFi space, with its total value locked (TVL) decreasing by over 12.5% in the last 30 days to approximately $54.2 million. Its stablecoin supply holds steady at $71 million but remains significantly lower than emerging DeFi-focused blockchains like Sonic and Berachain. This performance gap limits the network’s attractiveness to developers and investors, further straining XRP’s market performance.
Technical Analysis: Bearish Signals
XRP’s price chart exhibits a classic descending triangle pattern—a formation widely regarded as a bearish continuation signal. This pattern is characterized by a series of lower highs converging toward a stable support level. XRP recently breached the triangle’s lower support boundary, suggesting a heightened risk of further downside.
The projected price target derived from this pattern estimates a drop of approximately 43% from the breakdown point, placing XRP near $1.08. Should XRP fall below this level, the likelihood increases for it to tumble through the psychological $1 threshold, a critical level that often influences investor behavior.
Additionally, the current price is hovering near the 50% Fibonacci retracement level at around $1.90—another technical marker indicating the token has retraced nearly half of its gains from 2025’s peak.
Possible Bullish Scenario
While the outlook appears bearish, XRP’s price could rebound if it manages to surpass the $2.20 resistance level convincingly. Such a move would invalidate the descending triangle’s bearish implications and might open pathways for renewed upward momentum and price recovery.
Conclusion
XRP’s price decline is rooted in a confluence of regulatory delays, macroeconomic uncertainties, and internal challenges within its network’s DeFi ecosystem. Technical chart patterns further warn of a possible drop below $1 unless a strong reversal materializes in the near term. Investors should monitor SEC developments, geopolitical events, and on-chain metrics closely to gauge when and how XRP’s price trend might shift.
Stay tuned for ongoing updates and expert insights into the evolving cryptocurrency market.