XRP Faces Potential 20% Drop Amid Ledger Activity Slump

XRP is currently facing heightened volatility as recent declines in on-chain activity suggest increased bearish sentiment. As blockchain data points to a significant decrease in XRP ledger usage, analysts are warning of a possible downward movement that could push XRP toward the $1.70 mark.

Over the last sixty days, XRP’s ledger activity—reflected through metrics such as the number of transactions, active addresses, and smart token interactions—has seen a notable slowdown. This downward trend is being interpreted by market experts as a sign of weakening network demand, often an early indicator of slipping investor interest and potential price retractions.

Decreased Network Engagement Signals Bearish Outlook

Multiple key indicators point to a drop in blockchain engagement within the XRP ecosystem. The number of daily transactions transacted over the XRP ledger has dropped to levels not seen in several months. That fall is accompanied by a significant dip in the issuance and trading of XRP-based smart tokens, painting a picture of declining developer and user participation.

Historically, XRP has shown a strong correlation between on-chain momentum and price movements. When usage on its blockchain tapers off, market prices tend to follow. In this case, the 20% retracement target—putting XRP at roughly $1.70—is based on both technical support thresholds and weakening utilization metrics.

XRP Technical Picture Points to $1.70 as Key Support

From a technical analysis standpoint, XRP is navigating within a descending channel that has developed following its recent peak. Chart analysts observe that XRP may be heading towards its lower trendline support, hovering near $1.70. This level has served previously as a strong cushion during past corrective phases.

If broader market conditions remain turbulent and user activity continues to shrink, this $1.70 support level could be tested sooner rather than later. Should XRP break below that level, further losses could be in store as investor confidence might erode further.

Market Sentiment and Broader Crypto Trends

The wider digital asset landscape is also contributing to current XRP projections. As major cryptocurrencies like Bitcoin and Ethereum face resistance at critical levels, investor appetite across risk-on assets has cooled. XRP, often considered a mid-tier asset by institutional standards, is not immune to these waves of overall market sentiment.

This weakening mood, paired with lower transaction throughput on the Ripple blockchain, compounds the likelihood of XRP slipping to lower support zones. Traders and analysts alike are closely monitoring decentralized finance (DeFi) activity, token liquidity flows, and exchange volume to assess whether XRP can maintain stability amid the downturn.

Long-Term Prospects Still in Play

Despite short-term risks, some industry observers maintain a cautiously optimistic outlook for Ripple’s long-term evolution. The company behind XRP continues to expand its presence in cross-border payment solutions and enterprise blockchain infrastructure. These endeavors could eventually translate into renewed ledger activity and investor traction down the line.

Still, in the near-term horizon, XRP’s trajectory will likely be dictated by its ability to regain user engagement and reflect strength through on-chain fundamentals. Until those metrics stabilize or begin to climb again, XRP’s price dynamics will remain skewed to the downside.

Related: Expert Advice: Sell XRP If You’re Confused

Cryptocurrency markets remain highly speculative and reactive to shifts across technical and macroeconomic variables. Market participants are therefore advised to stay informed with both quantitative trends and broader sentiment indicators when evaluating XRP’s ongoing movements.