XRP Price Tumbles Below $1.30 Amid Fed Rate Decision and Senate Setback

Key Takeaways

• XRP experienced a 7.3% decline on Tuesday, breaking beneath the $1.30 threshold
• Prominent Dubai investor Royal Kane declined to buy XRP, citing concerns over its $81.68B valuation
• The Federal Reserve implemented a 25 basis point rate increase on September 16
• Senate cloture vote on the CLARITY Act fell short at 50-49 on September 15
• Futures market interest in XRP contracted from $1.128B to $871.22M within a month

The cryptocurrency XRP has fallen beneath the $1.30 mark following Tuesday’s 7.3% decline, representing approximately a 23% retreat from its recent peak near $1.68. The token recorded $4.12 billion in trading activity over the last 24-hour period, while maintaining a market capitalization around $81.68 billion.

XRP Price

This downturn arrives after a robust August performance, during which XRP surged from approximately $1 to nearly $1.70, securing a 28.5% monthly increase. United States spot XRP exchange-traded funds attracted $153.55 million throughout August, with $150.28 million flowing in during just the final fortnight.

Cryptocurrency analyst Cryptollica shared on X that XRP has recorded its lowest two-week Relative Strength Index (RSI) reading across its entire 13-year existence — surpassing the lows of 2018, the 2020 pandemic selloff, and the 2022 bearish cycle. However, Cryptollica observed that the price continues to maintain support above the long-term ascending structure that has underpinned XRP throughout numerous market cycles, stating: “Everyone wants XRP after the breakout. Almost nobody wants it when RSI is printing a 13 year low.”

Royal Kane, a cryptocurrency investor based in Dubai, announced publicly on X that he would pass on XRP investment at present levels. His rationale: with an $81.68 billion market cap, the asset has grown too substantial to deliver the return potential available from smaller-cap alternatives with more compelling narratives. He referenced Solana, Pepe, and Zcash as examples of tokens with strong stories that generated significant earlier profits.

Kane further asserted that Ripple lacks “no products or revenue.” Ripple, operating as a private company, actually manages multiple business lines including Ripple Payments, the RLUSD stablecoin project, and Ripple Prime, its institutional brokerage platform established following the Hidden Road acquisition.

Federal Reserve Rate Increase Pressures Speculative Assets

On September 16, the Federal Reserve increased its benchmark rate by 25 basis points, elevating the target band to 3.75%–4%. This marked the first American rate hike since 2023. Twelve out of 18 Federal Reserve officials forecasted additional increases ahead. Elevated rates enhance the appeal of U.S. Treasury securities relative to riskier holdings like digital currencies.

United States inflation reached 3.4% on an annual basis in August, with fuel costs climbing 3.9%. Forecasting markets had assigned an 81% probability to the rate increase prior to the announcement.

Digital Asset Legislation Blocked in Senate

On September 15, the Senate delivered a 50-49 vote against proceeding with the Digital Asset Market CLARITY Act, missing the required 60-vote threshold by 11 votes. This legislation aimed to divide cryptocurrency regulatory authority between the Securities and Exchange Commission and Commodity Futures Trading Commission, potentially establishing clearer guidelines for XRP’s classification.

XRP retains its 2023 legal victory from Judge Analisa Torres, who determined that programmatic XRP transactions on public trading platforms did not constitute securities offerings. Seven Democratic senators have subsequently resumed CLARITY Act negotiations, declaring the unsuccessful vote represents “not the end.”

Within derivatives markets, XRP open interest declined from $1.128B to $871.22M. Franklin Templeton’s XRPZ ETF recorded $3.5 million in inflows on September 16, maintaining a ten-consecutive-day positive flow streak even as Bitcoin ETFs experienced $295 million in withdrawals during the identical timeframe.

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