XRP Price Dips to $2: Are We Approaching a Bottom?

XRP price chart showing drop to $2 support level

Summary:
XRP's price has fallen to $2 amid a wider cryptocurrency market downturn, driven by leveraged selling. As traders speculate about an upcoming spot XRP ETF launch, some view the situation as a “sell-the-news” event. Despite this decline, Ripple Labs has made notable progress.

Key Takeaways:

XRP's price dropped to $2 during a significant sell-off in the crypto market.
The decline is thought to be influenced by traders closing leveraged positions and speculation around a new spot XRP ETF.
Analysts suggest that XRP may have reached its bottom despite the current downturn.
Ripple Labs continues to make operational advancements despite XRP's price decline.

XRP's value encountered a sharp decline to $2 on Tuesday as the digital asset market faced significant sell-offs. This downturn was marked by a notable exit of investment capital in just 12 hours, as per market data. XRP experienced larger losses than many other major cryptocurrencies, such as Ethereum and Binance Coin, which saw more modest declines. Data from exchanges indicates that XRP has hit a critical support level that has been consistently tested during previous market downturns.

Market analysts have pointed out that the absence of a strong trigger for this decline seems primarily linked to over-leveraged trading positions among market participants.

Market Outlook: Does XRP Show Signs of Recovery?

#XRP IS ABOUT TO GO INSANE. pic.twitter.com/46MyDuPmaT
— STEPH IS CRYPTO (@Steph_iscrypto) December 1, 2025

This price drop coincided with traders' expectations surrounding the launch of a new spot XRP exchange-traded fund (ETF), which will track the CME CF XRP-Dollar Reference Rate. Observers are referring to this market movement as a classic “sell-the-news” scenario, reminiscent of patterns seen in previous XRP ETF launches.

XRP saw a downturn after the introduction of the Canary Capital’s spot XRP ETF in the U.S. market mid-November, despite its strong initial performance. A subsequent product from Bitwise also showed positive early results before the token followed suit in its decline with the overall market.

As of now, four XRP ETFs that have been trading since the launch of the first product several weeks ago are attracting significant net inflows, suggesting growing investor interest. However, XRP's current price positions it lower in terms of year-to-date performance, having started 2025 at a higher valuation. This decline stands in contrast to the operational advancements made by Ripple Labs, the company behind XRP, throughout the previous year.