In the 30 days ending July 29, XRP (CRYPTO: XRP) has provided investors with a dream-worthy profit — increasing up to 43%. This is an impressive breakout, but for experienced investors, the question is not 'will XRP correct or not', but rather 'when will it correct, by how much, and will the reasons affect long-term prospects?'.

This article will analyze the factors that could cause XRP to 'slow down' in the short term, while explaining why price drops often resemble a 'discounted sell-off' rather than signaling a real collapse.

1. XRP and the summer sprint – But the attraction always exists

The rapid and strong increase of XRP like recently is often difficult to sustain without some corrections. There are three main factors that could exert downward pressure in the near term:

  1. Profit-taking from investors

    When prices rise sharply, buyers from the bottom tend to sell to lock in profits. On-chain data shows that more than 78% of the XRP supply is currently in profit, a ratio large enough to trigger a wave of profit-taking if market sentiment shows signs of wavering.

  2. Macroeconomic liquidity is unstable

    Although many forecasts suggest that global liquidity will improve in the coming year, the reality remains fragile. The path for interest rate cuts from the Federal Reserve (Fed) is still unclear, while global money supply growth in June has declined for the first time in 5 months. Slower liquidity often weakens the inflow of money into crypto.

  3. XRP ETF has not been approved

    Although Bloomberg experts assess a 95% chance that the XRP spot ETF will be approved in 2025, the SEC still has the authority to delay, add conditions, or create unexpected surprises. Just one piece of unfavorable news or prolonged silence can negatively affect market sentiment.

With these three factors, a correction of 10% – 20% is perfectly normal in the up-down cycle of the crypto market. Importantly, this does not mean a collapse, but rather a pause for the market to gain momentum.

2. The reason the pullback is an opportunity

If looking solely at price volatility, many will be concerned. But when considering the development fundamentals of XRP, investors have the right to be optimistic.

New long-term growth drivers:

  • Launching EVM sidechain on mainnet (June 30)

    XRP Ledger (XRPL) has integrated Ethereum Virtual Machine (EVM), allowing the execution of smart contracts written in Ethereum's language but using XRP as transaction fees. This opens the door for thousands of Ethereum developers to deploy applications on XRPL without having to learn new technology.

  • Ripple's enterprise stablecoin grows strongly

    Ripple has partnered with a Wall Street bank to custody USD backed stablecoin and a large exchange has integrated, helping to issue 122 million USD stablecoin. Each stablecoin transaction uses XRP, increasing fee volume and retaining users within the ecosystem.

  • Goal to obtain a national bank license in the US

    If successful, Ripple will be directly subject to federal regulation and have access to the Fed's payment system. This will be an important step, elevating XRP to become a part of traditional finance.

3. Investment strategy: Prepare in advance rather than trying to 'catch the bottom'

With new drivers such as:

  • Expanding the ecosystem through EVM sidechain

  • Bank-backed stablecoin and deep integration

  • Getting closer to spot ETF

  • Efforts to become a regulated financial institution

... every price drop of XRP now is unlikely to break the long-term positive trend. Instead of trying to accurately predict the bottom, investors should:

  1. Determining a reasonable XRP allocation in the portfolio

  2. Keeping a plan for partial disbursement when prices correct

  3. Taking advantage of market pessimism to buy in

Conclusion

XRP is in a phase where it is both completing its technology platform, expanding its application network, and enhancing its legitimacy in the eyes of financial institutions. A price correction, if it occurs, will be an opportunity to increase position rather than a reason to abandon. In the crypto world, those who know how to buy when others are scared are the ones who hold the long-term advantage.