Is XRP's Price Drop a Buying Opportunity Amid Ripple's Institutional Expansion?

The cryptocurrency market is no stranger to dislocation between price and value. In late 2025, XRP finds itself in a unique position: its price has dipped below $2, yet institutional demand for the asset remains robust. With over $1.12 billion in net inflows into XRP ETFs since mid-November 2025 and a growing narrative of quiet accumulation, the question arises: Is this price drop a buying opportunity for long-term investors?

Institutional ETF Inflows: A Divergence Emerges

XRP ETFs have defied the broader market's volatility, recording uninterrupted net inflows for over 33 days as of late 2025. This streak contrasts sharply with Bitcoin and Ethereum ETFs, which have seen outflows in recent weeks. Franklin Templeton's XRP spot ETF, for instance, now holds over 101.55 million XRP tokens, valued at approximately $192.7 million. These inflows, while smaller in absolute terms compared to BTC/ETH, reflect a growing institutional appetite for XRP's utility in cross-border payments and regulated crypto products.

The significance of this trend lies in its structure. Unlike retail-driven speculation, institutional buying is often executed through over-the-counter (OTC) channels to minimize price volatility. This "quiet accumulation" suggests that market participants are prioritizing long-term positioning over short-term trading, a dynamic that could eventually drive XRP's price higher.

Regulatory Clarity and Quiet Accumulation

Ripple's regulatory progress in 2025 has been a game-changer. The August 2025 settlement with the SEC-resolving a years-long lawsuit-removed critical uncertainty around XRP's classification as a security. This clarity has spurred a wave of institutional confidence, with nine asset managers filing spot XRP ETF applications and projected inflows of $5–$7 billion by 2026.

Meanwhile, on-chain data reveals a strategic buildup of XRP by large holders. Wallets holding 10–100 million XRP accumulated 340 million tokens in recent weeks, even as the price declined by 7.9% during a 15-day ETF inflow streak. This accumulation, coupled with a 32.7% drop in XRP's volatility (its lowest in seven months), indicates a controlled distribution phase. Institutional OTC trades now account for nearly 70% of large-block activity, reinforcing the idea that this phase is orchestrated by professional market participants.

Price vs. Value: A Market Dislocation?

Despite these fundamentals, XRP's price remains under $2, trading at a discount to its intrinsic value. The asset's market capitalization of $115.12 billion still reflects its role as a bridge currency in cross-border transactions, yet the price has not fully capitalized on its institutional adoption. Analysts attribute this dislocation to short-term selling pressure from large holders and the broader crypto market's risk-off sentiment.

However, the XRP Ledger's expansion into decentralized media applications and the launch of a lending protocol using Single Asset Vaults (SAVs) are creating new utility streams. These innovations provide institutional-grade yield opportunities, further enhancing XRP's appeal beyond its traditional use case.

Strategic Entry Point for Long-Term Investors

For investors, the current price level under $2 represents a compelling entry point. The combination of ETF inflows, regulatory tailwinds, and infrastructure integration positions XRP for a potential recovery in 2026. Analysts project a trading range of $2.00–$3.50 for the asset, with bullish scenarios targeting $4.00+ if broader market risk appetite improves.

The key risk lies in persistent selling pressure from large holders, which could prolong the price decline. However, the growing institutional demand-evidenced by $89.3 million in Q4 2025 inflows reported by CoinShares-suggests that this selling is being absorbed by long-term buyers.

Conclusion

XRP's price drop is not a sign of weakness but a reflection of market dislocation. The asset's fundamentals-driven by institutional ETF inflows, regulatory progress, and quiet accumulation-point to a divergence between current price and long-term value. For investors with a multi-year horizon, this could be a strategic opportunity to position for XRP's next phase of growth.