CoinDesk published a line this week that perfectly captures XRP’s situation: the token is attracting money but not buyers.
ETF products keep pulling in fresh inflows. Exchange balances keep shrinking. Whale wallets hit a record 332,230 addresses. And the price keeps falling. XRP dropped to approximately $1.10 on Thursday, its lowest level since February, extending a decline that has erased every cent of the post-CLARITY Act rally.
Three weeks ago, XRP was trading above $1.55 after the bill cleared the Senate Banking Committee 15-9. The market celebrated. Analysts projected $2.00 and higher. Standard Chartered estimated $4 to $8 billion in new ETF inflows if the legislation passed the full Senate.
Since then, XRP has fallen roughly 29%. The token that was supposed to benefit most from regulatory clarity is now one of the worst performers in the top 20, down 70% from its September 2025 high of $3.65 and below both its 50-day EMA at $1.37 and its 200-day EMA at $1.64.
The CLARITY Act is still alive. The fundamentals are still improving. And the price doesn’t care about any of it.
How the Entire Rally Evaporated
The timeline tells a painful story for anyone who bought the CLARITY Act breakout.
May 14: The bill cleared the Senate Banking Committee. XRP rallied from $1.30 to above $1.55 within days. The move felt like the beginning of something real.
May 20-25: Profit-taking began. Traders who bought the news started exiting. XRP drifted back toward $1.40. The retreat felt normal. Healthy consolidation after a strong move.
May 28: US airstrikes on Iran crashed the broader crypto market. XRP fell through $1.35 alongside everything else. The CLARITY Act premium started evaporating.
June 1: The bill was placed on the Senate Legislative Calendar under General Orders. A positive procedural step. XRP dropped to $1.29 anyway. The market stopped responding to good news.
June 2-4: Bitcoin collapsed from $67,000 to $61,000. XRP followed, breaking through $1.20 support and touching lows near $1.10. The CLARITY Act rally is now 100% gone.
The pattern reveals a market where XRP-specific catalysts can’t overcome the macro headwinds dragging the entire crypto sector lower. Good news provides temporary lifts. Bad macro conditions pull everything back down. And each cycle of hope and disappointment leaves XRP at a lower level than where it started.
The Contradiction That Defines XRP Right Now
The price action makes no sense if you only look at the flow data. And the flow data makes no sense if you only look at the price.
XRP investment products recorded $20.3 million in weekly inflows during the same period that broader digital asset funds suffered $1.5 billion in outflows. May’s total XRP ETF inflows reached $131.94 million, one of the strongest months since launch. Cumulative inflows since November 2025 have surpassed $1.5 billion.
More than 25 million XRP left exchanges in recent days, extending a trend that typically signals longer-term accumulation rather than selling. Whale wallets holding at least 10,000 XRP climbed to a record 332,230 addresses.
The institutional money is flowing in. The whales are accumulating. The exchange supply is shrinking. And the price dropped 29% in three weeks.
The disconnect exists because XRP’s price is being driven by two separate forces operating on different timeframes. The institutional accumulation through ETFs and whale wallets operates on a months-to-years horizon. The price action is being driven by short-term liquidation cascades, correlated selling with Bitcoin, and leveraged traders getting wiped out.
Short bets currently outnumber longs by roughly 9-to-1 in XRP derivatives. That extreme imbalance means the market is overwhelmingly positioned for further decline. It also means that any positive catalyst strong enough to push XRP higher would trigger a violent short squeeze as those positions are forcibly closed.
The setup is a coiled spring. The question is what triggers it.
The CLARITY Act Is the Trigger That Hasn’t Fired Yet
Everything comes back to the bill.
The CLARITY Act was placed on the Senate Legislative Calendar on June 1. That’s a necessary procedural step, but it doesn’t guarantee a floor vote. Senate leadership still needs to schedule the actual debate, merge the Banking Committee text with the Agriculture Committee version, and navigate over 100 proposed amendments.
JPMorgan warned this week that time is running short. The bank said the bill faces “several legislative hurdles” and that the stablecoin yield dispute with Jamie Dimon could become a deal-breaker. If the bill stalls before the summer recess, former Senator Cynthia Lummis warned it could mean waiting until 2030 for another legislative attempt because a new Congress would need to restart the entire process.
TradingView analysts have flagged June 15-18 as the most likely window for the CLARITY Act floor vote, coinciding with the FOMC meeting. If both events deliver positive outcomes, the combined catalyst could trigger the short squeeze that XRP’s derivatives setup is primed for.
Monte Carlo simulations run by 24/7 Wall Street across 10,000 probability paths put XRP’s base case range for June at $1.26 to $1.46, with a probability-weighted median of $1.56 if the CLARITY Act passes. The top 10% of outcomes push as high as $2.20. The downside scenario at 35% probability sees XRP pulling toward $1.00 if the bill stalls and institutional demand cools.
At $1.10, XRP is already below the model’s base case range. Either the model is wrong or the price has overshot to the downside and a reversion is coming.
A Historic RSI Signal
The monthly RSI has slipped below 43, a reading that has occurred only a handful of times in XRP’s 14-year history. CoinDesk noted that previous occurrences coincided with major market resets, though not necessarily immediate bottoms.
The four previous times XRP’s monthly RSI reached this level were before the 2017 expansion (when XRP subsequently rallied from $0.006 to $3.84), during the 2020 reset (which preceded a rally from $0.17 to $1.96), and during the 2022 bear market compression (which preceded the move from $0.30 to $3.65).
The pattern doesn’t guarantee a rally starts tomorrow. Monthly RSI operates on long timeframes, and the signal can persist for weeks or months before the turn arrives. But the rarity of the reading, four times in 13 years, tells you that XRP is in territory that has historically preceded its largest moves.
Where XRP Goes From Here
The technical picture has deteriorated to its worst point of 2026.
The $1.28 level that served as support throughout spring has flipped to resistance. Below current prices, $1.00 is the next psychological and technical support. A breakdown below $1.00 would be a level XRP hasn’t visited since early 2024 and would likely trigger another wave of liquidations.
On the upside, reclaiming $1.28 is the minimum requirement to stabilise the chart. Above that, $1.37 (the 50-day EMA) and $1.64 (the 200-day EMA) are the levels that define the longer-term trend.
The CLARITY Act floor vote, expected around June 15-18, is the event that determines which direction XRP breaks. A successful vote with strong bipartisan support would trigger the short squeeze, potentially producing a move to $1.50 or higher within days. A failed or delayed vote would confirm the bearish outlook and open the path to $1.00.
For holders, the setup is binary. The catalyst is identifiable. The timeline is known. The derivatives positioning creates explosive potential in both directions. XRP at $1.10 with a 9-to-1 short ratio and the most important crypto bill in history heading to a vote in two weeks is either one of the best risk-reward setups in the market or a trap that gets worse before it gets better.
The vote decides everything.
FAQ
Why did XRP drop from $1.55 to $1.10?
The entire CLARITY Act rally was erased by a combination of profit-taking, Bitcoin’s collapse from $82,000 to $61,000, Iran-driven geopolitical selling, and correlated liquidation cascades. XRP fell alongside the broader market despite continued ETF inflows ($131.94M in May) and record whale accumulation (332,230 addresses). The token is now below both its 50-day and 200-day EMAs.
What could cause XRP to recover?
The CLARITY Act floor vote, expected around June 15-18, is the primary catalyst. Short positions outnumber longs 9-to-1, creating conditions for a violent squeeze if the vote passes. Monte Carlo simulations project a median of $1.56 if the bill clears the Senate. The FOMC meeting on June 17-18 could provide an additional catalyst if Fed Chair Warsh signals rate cuts.
Could XRP drop below $1.00?
Yes. If the CLARITY Act stalls or fails, and Bitcoin continues declining, XRP could test the $1.00 psychological support. The 35% probability downside scenario from analyst models targets exactly that level. The monthly RSI below 43 suggests XRP is in historically rare oversold territory, but previous instances at this level took weeks to months before producing recoveries.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making any investment decisions.
