XRP: Is Institutional ETF Demand Creating a Base for a Stronger Bull Run?

The XRP market in late 2025 presents a paradox: while institutional demand for XRP spot ETFs has surged to historic levels, the token's price remains under pressure, trading near $1.91 as of December 16, 2025, below the critical $2.00 psychological threshold according to data. This divergence between inflows and price performance has sparked debate among investors and analysts about whether the current weakness is a temporary correction or a precursor to a more sustained bearish phase.

Institutional ETF Inflows: A Structural Shift?

U.S.-listed XRP spot ETFs have recorded a remarkable 30 consecutive days of net inflows since their November 13, 2025, launch, accumulating over $1 billion in assets under management by December 12. This outpaces the inflow trends of Bitcoin and Ethereum ETFs during the same period, which have faced outflows amid broader market volatility. Ripple CEO Brad Garlinghouse has emphasized that these inflows reflect a "structural allocation" by institutions, driven by XRP's role in cross-border payments and improving regulatory clarity.

Data from on-chain analytics further underscores institutional confidence. Long-term holders, including a seven-year-old wallet that crystallized $721.5 million in profits at $2.00, continue to add to their positions, suggesting a belief in XRP's long-term utility. Meanwhile, retail traders-many of whom bought during the summer rally above $3.00-are cutting losses as the price declines, exacerbating short-term bearish pressure.

Technical Weakness: A Bearish Overhang

Despite the inflows, XRP's technical indicators remain bearish. The token is trading below key moving averages: the 50-day EMA at $2.19, the 100-day EMA at $2.37, and the 200-day EMA at $2.44. The MACD and RSI indicators, both below neutral thresholds, signal fading upward momentum. Immediate support is seen near $1.92, with a breakdown below this level potentially pushing the price toward $1.86 and the April 2025 low of $1.61 according to analysis.

The death cross formation on November 19-where the 50-day EMA crossed below the 200-day EMA-has further reinforced bearish sentiment across the broader crypto market. On-chain data reveals that 37% of XRP holders are currently underwater, with elevated selling pressure concentrated in the $2.00–$2.16 range according to data.

Bullish Divergence: Signs of a Potential Reversal

Amid the bearish backdrop, technical analysts have identified several bullish divergences that could signal a trend reversal. On November 27, XRP's RSI formed a bullish divergence, with momentum rising despite lower price lows-a pattern historically associated with market bottoms. Similarly, the MACD indicator showed a bullish divergence, suggesting weakening bearish control according to analysis.

Crypto analyst Dark Defender argues that XRP is in Wave 4 of the Elliot Wave theory, a correctional phase that must complete before the bullish Wave 5 can begin, with a long-term price target of $5.85 according to analysis. STEPH IS CRYPTO has also highlighted an inverted head-and-shoulders pattern and a double bottom forming in the $2.05–$2.00 zone, both of which could indicate accumulation ahead of a rebound according to analysis.

However, these signals remain unconfirmed. A clean breakout above $2.20–$2.30 or the $2.60 level is seen as critical for sustaining a bullish trend according to analysis. Without sustained volume above these thresholds, the current divergence may fail to reverse the broader downtrend.

The ETF-Price Divergence: A Base in the Making?

The disconnect between ETF inflows and price performance raises questions about whether institutional demand is building a base for a stronger bull run. While XRP's price has fallen by over 13% in the past 30 days, the ETFs' consistent inflows suggest growing institutional conviction. This dynamic mirrors historical patterns where ETF-driven demand eventually overcomes short-term bearish momentum, as seen in Bitcoin's 2023 rally.

Analysts caution, however, that retail sentiment and macroeconomic stability will play pivotal roles. As one expert notes, "Institutional inflows alone may not be enough to reverse the broader trend without improved retail participation or a stabilization in the macroeconomic environment" according to data.

Conclusion: A Tenuous Balance

XRP's current trajectory reflects a tug-of-war between institutional optimism and technical bearishness. While the ETF inflows indicate structural demand, the token's price remains trapped in a descending channel, with key resistance levels at $2.00 and $2.20 acting as formidable barriers according to analysis. The bullish divergences in RSI and MACD, coupled with Elliot Wave and pattern-based analyses, suggest a potential reversal is on the horizon-but only if XRP can overcome these hurdles with sustained volume.

For investors, the coming weeks will be critical. A breakout above $2.20 could validate the bullish case, while a breakdown below $1.92 would likely deepen the correction. In the meantime, the ETF inflows remain a compelling indicator that XRP's institutional narrative is far from over.