XRP price tumbles as crypto selloff intensifies, silver-like volatility returns to tokens

XRP slid sharply on Thursday as a broader crypto downturn accelerated into a wave of forced selling, with traders cutting risk and leveraged positions unwinding across major tokens. The move extended a rough start to February for digital assets, with price action increasingly driven by liquidation mechanics and risk-off sentiment rather than coin-specific headlines.

By Thursday evening, February 5, 2026 (ET), XRP had fallen into the low-$1 range after briefly trading even weaker earlier in the session, tracking steep declines in bitcoin and ether as the market searched for a floor.

XRP price: where it stands

The latest tape shows XRP under outsized pressure relative to other large tokens, with wide intraday swings.

Large ranges like these are a sign that liquidity is thin and positioning is being reduced quickly, which tends to punish coins with higher speculative participation.

Why XRP fell harder than most

XRP’s steeper drop reflects how quickly “fast money” can exit when momentum breaks. When a market shifts from dip-buying to capital preservation, traders tend to sell what they can sell first—highly liquid, widely held tokens—before they even decide what they want to own next.

XRP also has a history of sudden percentage moves because many participants use derivatives to amplify exposure. When price falls through key levels, automated risk controls and margin calls can create a cascade: selling triggers more selling, and even a small bounce can fade if it meets another wave of liquidation.

Liquidations and leverage are driving the tape

Thursday’s action fits a familiar pattern during crypto downshifts:

• Leverage builds during rallies, especially in perpetual futures.

• A sharp drop forces traders to add collateral or close positions.

• Forced closures hit the market as sell orders, pushing price lower.

• Stop-loss triggers and systematic strategies add momentum.

This is why declines can look “overdone” in the moment. The price isn’t only reflecting a new long-term view; it’s reflecting the mechanics of risk reduction at scale.

Macro pressure: risk-off mood and tighter liquidity

Beyond crypto-specific mechanics, the broader market backdrop has turned less friendly for speculative assets. A pullback in risk appetite—especially when equities wobble—often hits crypto quickly because it trades as a high-beta expression of sentiment.

When investors move toward cash-like safety, it doesn’t take a single crypto headline to cause damage. The absence of fresh buyers can be enough. In that environment, rallies tend to be short and sharp, and dips can keep extending because traders expect better entries later.

Spot ETF chatter and the “institutional bid” question

Investors have also been debating the next catalyst: whether regulated spot products linked to XRP will materialize and, if so, whether they create durable demand or simply shift existing demand into a new wrapper.

Several firms have filed to launch spot XRP funds, but approval timing remains uncertain. That uncertainty matters because traders often price in the narrative early. If the “future ETF bid” becomes a consensus story, it can lose power as support—especially when macro conditions worsen and leveraged positioning is already elevated.

What to watch next

In the near term, XRP’s direction is likely to hinge on a few observable signals rather than speculation:

1. Stabilization of liquidation intensity: smaller intraday ranges would suggest forced selling is cooling.

2. Bitcoin’s ability to hold key levels: XRP often struggles to rally sustainably if bitcoin keeps sliding.

3. Derivatives reset: lower open interest and calmer funding rates can create room for a more stable base.

4. Flow clarity: whether large holders and regulated vehicles show steady net buying after the shakeout.

For now, the message from the market is blunt: volatility has returned, and XRP is behaving like a high-octane risk asset. If broader sentiment steadies, rebounds can be sharp—but the same leverage that fuels upside can also amplify the next downdraft.

Sources consulted: Reuters, CoinDesk, Yahoo Finance, Barron’s