Ripple Price Crash: 3 Reasons XRP Fell Below $2 and What Comes Next!

Headlines are turning less optimistic for XRP, the digital currency created by Ripple to simplify global payments, after its strong 2024 performance. XRP saw a 235% gain amid crypto regulation optimism but has since plunged significantly. It fell over 40% from its 52-week high. Ripple recently even dipped under the key $2.00 level. President Trump’s sweeping tariff announcement appeared to trigger this decline, prompting widespread selling across risk assets.

Digital assets like Ripple should not face direct tariff impacts, yet broader market sentiment has shifted. Although XRP maintains a solid use case for cross-border payments, investors are reassessing its immediate prospects. This situation poses a key question: Is the decline temporary, or does it indicate deeper problems ahead for Ripple?

XRP’s Real-World Utility: A Long-Term Support?

Ripple’s main value proposition is eliminating inefficiencies within global banking processes. Ripple allows financial institutions to avoid traditional networks, using XRP instead for instant, low-cost settlements. This ability established a tangible role for the digital currency. Every Ripple transaction costs a mere fraction of a cent, making it attractive for institutions handling large volumes.

However, a significant issue challenges this positive outlook, as banks can utilize the Ripple payment system without using XRP itself. This undermines the idea that network adoption will necessarily drive XRP price appreciation. Consequently, XRP’s long-term value, although promising, might not be as tightly connected to its adoption rate as investors would prefer.

Crypto Regulation Relief Fuels Optimism, But Risks Remain

The massive 2024 Ripple price surge resulted from a favorable political environment and relief from longstanding regulatory challenges. The United States Securities and Exchange Commission’s lawsuit against Ripple had overshadowed the token since 2020. That uncertainty decreased in August 2024 after a judge’s ruling on XRP’s status. The ruling stated that a ripple is not necessarily a security in all contexts, reducing potential future regulatory obstacles.

With Trump back in office and the SEC adopting a more tolerant stance under Chairman Mark Uyeda, the crypto sector has seen a marked improvement in sentiment. The reduced settlement with Ripple and paused lawsuits against major platforms like Binance and Coinbase signal a regulatory slowdown. Still, investors must tread cautiously—future political shifts or renewed legal challenges could quickly reverse the current friendly environment.

Speculation Drives XRP Price More Than Fundamentals

Despite favorable developments, Ripple failed to break its $3.40 all-time high from 2018 during the 2024 surge, as shown in Chart 1. This has led analysts to believe that speculative interest, rather than fundamental utility, continues to dominate its price action. The lack of sustained momentum highlights the disconnect between XRP’s potential use case and its market performance.

Chart 1 – Published on CoinMarketCap, April 10, 2025.

Ripple has long shown a pattern of sharp rises followed by lengthy downturns. After reaching its peak in 2018, it lost over 90% of its value. The recent 40% drop could signal a similar trend playing out. For now, investors appear wary, reluctant to chase gains without clearer evidence that utility-driven demand will eventually influence Ripple price.

Final Verdict: Proceed with Caution in a Volatile Landscape

As Ripple price hovers just around the $2 mark, investors are left navigating a complex mix of optimism and uncertainty. While XRP’s real-world utility and regulatory progress offer reasons for long-term hope, market speculation and legal risks reduce expectations. The current downturn could represent a temporary dip or the start of a deeper correction mirroring past cycles.

Ultimately, XRP remains a compelling but high-risk digital currency. Its success will depend on whether institutions adopt it alongside the company’s network and if regulatory clarity continues. Until then, investors should view the current price as a buying opportunity and a reminder of the crypto market’s inherent volatility.