XRP entered the last quarter under strong pressure after a significant sell-off that erased large parts of previous gains. The decline in Q4 has put the altcoin on track to end 2025 in negative territory.
Despite this setback, there is still hope that buying activity from investors may attempt to reverse the trend before the year is over.
XRP investors sold at a loss
On-chain data for realized gains and losses shows that the selling in Q4 was unusually aggressive. XRP holders exited positions at a loss, signaling weakened confidence. Historically, investors in large tokens have tended to hold through downturns in anticipation of a rebound, rather than realizing losses.
This cycle feels different. Selling at a loss indicates increased uncertainty around XRP's short-term outlook. The behavior suggests that risk aversion has overtaken long-term conviction, contributing to sustained downward pressure in the quarter.
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XRP's broader performance context highlights the challenge. The current market cycle threatens to end a two-year streak of positive annual returns. In 2023, XRP rose by 81%, followed by an increase of 238% in 2024, driven by increased regulatory clarity and speculative demand.
In contrast, 2025 has been characterized by weaker performance. If current levels persist, XRP could end the year down about 11%. This reversal shows how changes in macro conditions and investor confidence can break even strong historical trends.
Despite the downturn, activity on the XRP Ledger has declined at the end of December. Network data shows that the number of active transaction addresses reached a monthly low of 34,005. The falling participation suggests that engagement from both retail and institutional users is weak.
Higher transaction activity is often associated with increased demand. Low usage can contribute to price declines by affecting liquidity and weakening interest based on actual use cases. This decline towards the end of the year may reflect strategic positioning for 2026 rather than short-term speculation.
XRP is trading near $ 1.85 at the time of writing, down 11% since the start of 2025. To neutralize this year's losses, the token must rise to $ 2.10. Achieving this level will allow XRP to end the year flat and preserve its long-term performance streak.
Currently, however, there remains downside risk if market conditions worsen. If $ 1.85 does not hold, it could trigger a fall towards $ 1.70. Such a development would invalidate the bullish thesis and confirm a negative year-end, extending uncertainty into early 2026.
An upward-dependent path to improvement requires that the support level at $ 1.85 is defended with increased participation. Maintaining this level could enable a rise towards $ 1.94. Breaking through this resistance is crucial to making $ 2.00 a support level and clearing the last hurdle towards the goal of $ 2.10.
