XRP Drops Due To Trump’s Tariffs: Investors’ Confidence Also Faltered

XRP started August on a shaky note, falling more than 5% in 24 hours as President Trump’s aggressive new tariffs triggered another round of crypto market sell-offs. Tariffs, however, are not the only source of pressure. Investor sentiment dipped after notable token transfers involving Ripple’s co-founder were revealed.

What part did Trump’s tariffs play in XRP’s drop?

Most of the crypto market, including XRP, started August in the red. President Trump’s most recent round of broad tariffs caused risk assets to go haywire. XRP dropped more than 5% in 24 hours because the whole market was reacting to rising geopolitical tensions and worries about inflation. The uncertainty caused by the tariffs led to a lot of panic selling of big digital assets.

Coinglass says that traders acted quickly and sold short positions worth more than $1 million in XRP in just four hours. These liquidations had a ripple effect (no pun intended) that made the market even more nervous and increased the selling pressure.

How did insider trading affect how confident investors were?

Traders were even more scared by internal changes in the XRP ecosystem, in addition to outside economic pressures. On-chain data that crypto analyst ZackXBT recently found showed that Chris Larsen, one of the founders of Ripple, sent 50 million XRP, or about $175 million, to several addresses between July 14 and 24.

It’s not unusual for big holders to move money, but the timing couldn’t have been worse. The fact that insiders were selling XRP made people even more worried about a possible dump, which made an already nervous community even more so.

Was XRP already starting to lose strength?

XRP had been stuck in a narrow trading range between $3.10 and $3.30 for the past week, even before the tariff shock and Larsen’s wallet activity. The lack of bullish breakout made the token more vulnerable to a quick drop once macro factors hit. XRP didn’t need much to fall, and that’s exactly what happened.

XRP has gone up more than 35% in the last month, but as of this writing, it is back below $3 and is testing important support levels. Investors are keeping a close eye on whether this pullback will stabilize or get worse, since the market is shaky and institutions don’t trust it.

XRP is having a hard time on many fronts, including Trump’s tariff war and signs of trouble within Ripple’s leadership. XRP holders may have a rough time in August if the asset doesn’t get back on track soon.

Also read: Can XRP Become the Next Bitcoin? Here’s What Investors Should Know