2026 Cryptocurrency Market New Focus: How XRP ETF Will Drive XRP Price Surge and Market Cap Leap

Less than two months before the launch of the United States’ first XRP spot ETF, this innovative financial instrument has already brought over $1 billion in capital inflows to the XRP market. In the first week of 2026, XRP saw nearly $100 million in cumulative inflows, with a single-day net inflow of $46.1 million on January 5.

XRP’s strong performance at the start of 2026 has allowed it to surpass BNB and reclaim the third position in cryptocurrency market capitalization. As of January 7, XRP’s circulating market cap reached $138 billion, ranking fourth in the overall market, down 4% in 24 hours but up 22% over 7 days.

01 Market Performance

At the beginning of 2026, XRP experienced a remarkable price rebound on the Gate exchange. From a low of $1.84 on January 1 to a high of $2.40 on January 6, XRP achieved over a 30% increase in just a few days.

On January 6, XRP surged 11.34%, briefly reaching $2.40, its highest level since November 13, 2025.

According to Gate market data, XRP is currently priced at $2.26. Despite a 4% decline in 24 hours, the 7-day gain remains at 22%, demonstrating strong recovery capability. Behind this price performance, the capital inflow into XRP ETF has played a significant role.

02 ETF Effect

Since its debut on November 13, 2025, the US spot XRP ETF has recorded net capital inflows for eight consecutive weeks, accumulating over $1.23 billion. This sustained institutional capital inflow provides solid support for the XRP market.

ETF capital inflows accelerated at the start of 2026, with a single-day net inflow of $46.1 million on January 5, setting a new high since December 3. Meanwhile, the total trading volume of XRP ETF on that day reached $72.15 million, not only the highest since November 24 but also the second highest since listing.

CNBC reported XRP as “the hottest cryptocurrency trading in 2026,” noting “it’s not Bitcoin, nor Ethereum, but XRP.”

This institutional recognition reflects a market reassessment of XRP’s potential in “cross-border payments,” especially after Ripple reached a settlement with the U.S. Securities and Exchange Commission (SEC), removing legal risks.

03 Institutional Drivers

ETF capital inflows are just one aspect of institutional interest in XRP. More detailed data shows that XRP holdings on exchanges have fallen to multi-year lows, indicating a reduction in idle tokens ready to be sold during market rallies.

According to CryptoQuant data, XRP reserves on Binance have dropped to their lowest level in two years. High exchange balances typically suggest investors are preparing to sell, while low balances indicate long-term holding tendencies.

Meanwhile, XRP’s network activity is also increasing. Data from XRPscan shows that network activity and trading volume have grown by over 50% in the past two weeks.

Ripple Labs recently announced partnerships with major Japanese financial institutions, including Mizuho Bank, Sumitomo Mitsui Banking Corporation, and Securitize Japan, to promote adoption of the XRP Ledger in Japan. These collaborations further solidify XRP’s position in cross-border payments.

04 Technical Perspective

From a technical analysis standpoint, XRP recently completed a classic technical breakout, successfully breaking out of a “descending wedge” consolidation zone and stabilizing above the 50-day moving average, which is a very strong bullish signal.

As the price surged rapidly, a large number of XRP short positions were forcibly liquidated. In just one hour, the total liquidation amount across the network exceeded $250 million, indicating that buying pressure and short covering were simultaneously active.

Chart analyst “The Great Mattsby” pointed out that the XRP/BTC rate is approaching a monthly Ichimoku cloud breakout, a first since 2018. This relative strength signal suggests that, if confirmed, XRP’s performance could outperform Bitcoin.

Currently, traders are closely watching whether XRP can retake the $2.31–2.32 range or whether it remains in a downtrend channel. When the price fell to $2.21 on January 6, volume surged to $256.3 million, 142% above the 24-hour simple moving average, but this sell-off was absorbed by demand, stabilizing the price.

05 Future Outlook

Despite some technical correction pressures in the short term, multiple analysis firms remain optimistic about XRP’s long-term prospects. Different forecasting platforms suggest a variety of potential paths for XRP in 2026.

Fundamentally, the improved relationship between Ripple and U.S. regulators has cleared long-standing legal hurdles for XRP. In summer 2025, the lengthy lawsuit between SEC and Ripple Labs finally concluded, with both sides withdrawing their appeals.

The court ruled that XRP is not a security, although Ripple Labs was fined $125 million. This decision eliminated the biggest legal uncertainty for institutional investors considering XRP.

Market analysts project XRP’s price in 2026 to range from $1.77 to $3.40, with an extreme bullish scenario potentially pushing it to $8. These forecasts are based on expanding XRP’s application in cross-border payments, accelerated institutional adoption, and ongoing ETF capital inflows.

Future Outlook

On January 6, when XRP briefly broke above $2.40, traders excitedly shared screenshots in chat rooms. One user wrote, “This feels like 2017, but this time there’s real institutional backing behind it.”

As XRP reclaims the third-largest position in the cryptocurrency market cap, analysts are discussing whether it can challenge Ethereum for the second spot. Data from CoinDesk shows XRP holdings on exchanges have fallen to multi-year lows.

While most investors remain cautious, institutional investors who bought XRP ETFs during the market downturn in Q4 are now enjoying substantial returns in early 2026. They bet that this rally is not just a fleeting spike but a shift built on more solid fundamentals.