XRP is under mounting pressure as Ripple’s recent institutional activity brings renewed scrutiny to the token’s long-term support levels.

The token, often associated with fast cross-border payments, dipped over 7% in the last 24 hours, sliding to a recent low of $5.27. Analysts suggest this decline, which breached vital support near $5.48, signals mounting bearish sentiment among institutional investors.

Trading data reveal a pronounced uptick in volume, with activity reaching 708,905 ICP tokens—nearly double the daily average of 386,248. This spike, occurring in the early hours of August 18, points to large-scale selling potentially orchestrated by major investors or treasury committees. Though there was a brief rebound, the token quickly slipped again, settling near $5.29.

Broader market nerves also played a role in XRP’s decline—as institutional attitudes shift amid macroeconomic concerns. Last week’s unexpectedly strong Producer Price Index (PPI) report for July 2025 reignited fears over potential U.S. inflation spikes, setting off a chain reaction across digital assets.

How Institutional Trends Are Driving XRP’s Performance

The cryptocurrency market may be leaning risk-off, and XRP, like other speculative assets, is feeling the pressure. As liquidity shrinks and investors grow cautious, assets without immediate utility or bullish catalysts become targets for liquidation.

Ripple’s XRP Ledger (XRPL) has seen institutional interest wax and wane over time, based on macroeconomic shifts. The latest downturn suggests a dip in confidence by larger players, particularly in response to inflation concerns. Rising yields and tightening monetary expectations leave less incentive to hold—or accumulate—volatile assets like XRP.

This erosion of support below $5.48 wasn’t entirely unexpected given recent fund flows. Analysts tracking wallet movements have noted distinct offloading patterns synced with risk events like economic reports or geopolitical uncertainty.

Analyzing XRP’s Volume Spikes and Weak Recovery

Volume can be revealing. During the decline, XRP volume soared well beyond its usual pace—an indicator of institutional momentum. When large players move in coordinated fashion, retail sentiment and smaller participants are often caught off guard, resulting in liquidity slippage.

Attempts to regain momentum were short-lived. A minor rally to $5.35 faltered quickly, giving way to another dip to $5.29, wiping out most recovery gains. The current consolidation around this lower band may indicate a standstill shaped by a lack of institutional bids, rather than retail enthusiasm.

This chart illustrates ICP’s price drop alongside a dramatic surge in trading volume, highlighting the intensity of institutional selling.

Ripple’s Role and XRP’s Market Outlook

Ripple’s influence over XRP’s ecosystem remains significant. While the company actively pushes for expanded utility and engagement across fintech and banking sectors, the token’s speculative nature still makes it vulnerable during market downturns. Investors evaluating XRP’s future must weigh Ripple’s infrastructure enhancements against broader risk sentiment in crypto markets.

Traders watching XRP’s chart are now eyeing the psychological $5.00 support. If breached, it could invite another wave of sell-offs. However, a return of institutional demand might stabilize prices, assuming no new macroeconomic shocks disrupt confidence further.

Related: XRP Price: $12M Max Pain for Bears

In summary, XRP’s latest slump underscores how closely tied it is to broader financial sentiment and institutional capital flows. Unless Ripple’s strategic efforts succeed in attracting sustained interest, short-term volatility may continue to challenge token holders.