XRP’s recent price rally has hit a pause, with the digital asset struggling to maintain momentum near a key support level of $2.35. The stall in upward movement coincides with the U.S. Securities and Exchange Commission (SEC) introducing a delay in its decision on the 21Shares Core XRP Trust, a proposed spot exchange-traded fund (ETF) that aims to provide direct exposure to XRP.
This development has contributed to a cooling of trader enthusiasm, reflected in both spot and derivatives markets. As the SEC takes more time to assess the ETF’s compliance with regulatory standards, XRP investors appear to be growing cautious, waiting for further clarity before making bold moves.
At the time of writing, XRP is hovering around $2.35, representing a 1.4% drop over the past 24 hours and a more pronounced 8.3% decline over the past week. The recent dip follows a strong rally earlier in the month, raising questions about whether bullish momentum has temporarily run out of steam.
Trading volumes also tell a sobering story. Over the last day, XRP recorded approximately $2.67 billion in spot trading volume, marking a significant 15.9% decline from the previous day. This drop suggests traders are stepping back, possibly adopting a wait-and-see approach amid growing regulatory uncertainty.
Market sentiment is also weakening on the derivatives side. According to data from Coinglass, open interest in XRP futures contracts fell by 3.14%, down to $4.58 billion. Meanwhile, futures trading volume plunged a steep 28.45%, landing at $4.24 billion.
A decline in open interest often indicates that traders are closing positions instead of initiating new ones—a sign of reduced conviction in short-term price movements. Combined with the sharp drop in volume, the data points to a broader cooling in speculative interest surrounding XRP.
On May 20, the SEC formally extension of the review period for the 21Shares Core XRP Trust. This proposed ETF aims to track the performance of XRP using the CME CF XRP-Dollar Reference Rate and would rely on Coinbase Custody to safeguard its assets.
The agency explained in its filing that the additional time is necessary to thoroughly evaluate whether the ETF complies with Section 6(b)(5) of the Exchange Act. This section mandates that national securities exchanges prevent fraudulent practices and protect investors—requirements that are central to the SEC’s oversight of crypto-based financial products.
The new public comment window will remain open for 21 days, followed by a 35-day rebuttal period after publication in the Federal Register. While the delay doesn’t equate to a rejection, it does prolong the timeline for a final decision.
Bloomberg ETF analyst James Seyffart weighed in on the situation via X (formerly Twitter), stating the delay was “expected” and suggesting that approvals for crypto spot ETFs like those for XRP or Solana (SOL) are unlikely before late Q2. He believes early Q4 is a more realistic timeframe.
From a technical perspective, XRP’s current position offers no clear bullish or bearish signals. The token is nearing the lower band of the Bollinger indicator—a measure typically associated with cautious trading behavior. The Relative Strength Index (RSI) stands at 52, indicating a neutral outlook.
Short-term moving averages, including the 10-day Exponential Moving Average (EMA) and Simple Moving Average (SMA), suggest bearish momentum could persist. However, longer-term indicators like the 20-day through 200-day EMAs and SMAs still reflect a bullish bias, hinting that the overall uptrend remains intact despite short-term turbulence.
For traders eyeing potential breakouts, $2.38 remains a key resistance level. A sustained move above this price could pave the way for a climb toward $2.61 and potentially higher zones if volume supports the move.
On the downside, a drop below the 20-day SMA at $2.34 could signal increased selling pressure. In that case, XRP may test lower support levels at $2.26 and possibly as far as $2.06. Breaching these thresholds could confirm a more bearish short-term trend.
The delay in the SEC’s decision is not necessarily negative, but it has added another layer of uncertainty for XRP investors. ETFs tied to cryptocurrencies have historically influenced both market sentiment and price action, and the final ruling on the 21Shares XRP Trust could become a pivotal moment for the token.
Until then, XRP is likely to remain range-bound as investors assess regulatory signals and watch technical indicators closely. For now, the market appears to be in a holding pattern, with attention squarely focused on Washington and the SEC’s next move.
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