XRP has emerged as one of the standout performers in early 2026, maintaining a bullish structure even as much of the crypto market struggles to regain momentum. The divergence has fueled debate across the market, with analysts suggesting that XRP can sustain its bullish momentum while macro uncertainty and geopolitical risks dominate investor sentiment.
According to Santiment, market sentiment has turned sharply bearish for Bitcoin and Ethereum following last week’s steep crypto sell-off. Specifically, Bitcoin sentiment has fallen to an extremely bearish ratio of 0.796, while Ethereum remains firmly bearish at 1.088. In contrast, XRP continues to stand out, with trader sentiment staying optimistic at a ratio of 2.197.
XRP Defies Market Weakness as Institutional Demand Grows
While leading assets like Bitcoin and Ethereum remain volatile, XRP has continued to attract institutional interest. Market data shows it rallied over 30% in early January, briefly touching $2.41 before entering a consolidation phase below $2.10.
Analysts attribute this resilience to renewed institutional positioning, especially following the launch of multiple XRP spot ETFs in late 2025, which have collectively absorbed nearly $1 billion worth of tokens from circulation
Beyond ETFs, Ripple’s expanding partnerships across global payment corridors, financial infrastructures, and collaborations with firms like Mastercard and Gemini, expanding real-world settlement use cases, are strengthening the altcoin’s utility narrative.
Structural Scarcity Reinforces XRP’s Bull Case
One of the most significant drivers behind XRP’s bullish outlook is its rapidly shrinking liquid supply. On-chain data shows that exchange balances have fallen from approximately 3.7 billion tokens to just 1.6 billion within the past year, largely due to ETF accumulation and institutional settlement usage.
This trend has sparked growing speculation that XRP could approach “functional zero” liquidity by late 2026. This is a threshold where limited circulating supply may trigger aggressive repricing. Analysts argue that its evolving role as settlement infrastructure, rather than a purely speculative asset, is accelerating this scarcity effect.
Bitcoin Faces Headwinds Amid Macro Uncertainty as XRP Holds Ground
While XRP pushes higher, Bitcoin continues to face macro-driven pressure. After plunging below $70,000, BTC has entered a volatile consolidation phase, with traders closely monitoring ETF flows, geopolitical developments, and global interest rate expectations .
Although long-term institutional accumulation remains strong, short-term market sentiment is increasingly cautious. Analysts warn that persistent resistance at key psychological levels could lead to extended sideways trading or deeper corrections if macroeconomic uncertainty intensifies.
This divergence has created a split among traders, with some rotating capital into high-performing altcoins like XRP, while others remain positioned defensively around Bitcoin.
Traders Split as Market Searches for Direction
The contrasting price action across major crypto assets has highlighted a growing divide in trader sentiment, particularly between Bitcoin and Ethereum, as investors reassess risk exposure amid persistent market volatility.
On the one hand, Bitcoin continues to attract capital as a macro hedge and long-term store-of-value, benefiting from sustained institutional interest and its dominant market positioning.
On the other, Ethereum is increasingly viewed as a growth-oriented bet on blockchain infrastructure, driven by expanding network upgrades, rising staking participation, and growing demand for decentralized finance and real-world asset tokenization.
Evans Kelvin
The CoinRemark Team
