XRP Down 40%: Time to Buy the Dip or Abandon Ship?

Mew

Master, I have received today's topic. It's about your friend who is suffering a significant loss from their Ripple (XRP) investment.

I am sorry to hear about your friend's situation. Experiencing a loss in an investment is a painful thing. The three of us will analyze this problem properly to provide a starting point for you and your friend to think about how to respond going forward.

Mikael

Your friend's loss is unfortunate, but we must not be swayed by emotion. In situations like this, it's more important than ever to face reality with a cool head. Let's begin.

Mew

I will now brief you with a summary of the currently available data.

• Price Trend: Ripple (XRP) hit a peak of around $3.40 on January 15, 2025. As of today (June 27, 2025), it is trading near $2.00, a drop of about 41%. A decline of this magnitude is quite significant, even in the highly volatile cryptocurrency market.


• Key Driver (SEC Lawsuit): The primary cause of the price surge and subsequent crash appears to be news related to the long-standing lawsuit with the U.S. Securities and Exchange Commission (SEC). In early 2025, expectations that the lawsuit would conclude favorably for Ripple reached a fever pitch, causing the price to skyrocket. However, recent news about a settlement on the penalty amount for some issues or a 'temporary pause' in the appeal process led to a price correction, driven by a mix of 'sell the news' phenomena and disappointment that it wasn't a complete victory. Some experts anticipate the lawsuit could be fully resolved around August of this year, but nothing has been confirmed.


• Business Data: Ripple's business itself is continuing to expand. In particular, its cross-border payment solution, On-Demand Liquidity (ODL), continues to announce new partnerships with financial institutions in Asia and the Middle East. The fact that Ripple is participating in discussions related to CBDCs (Central Bank Digital Currencies) in several countries is also a positive sign.


• Technical Data: The XRP Ledger (XRPL) itself is also continuously being upgraded. Recent technical advancements include a sidechain compatible with the Ethereum Virtual Machine (EVM), regulatory compliance features for institutional adoption, and the introduction of a new token standard (MPT). This shows the potential for ecosystem expansion beyond XRP's simple payment function.

To summarize, the price has been on an extreme roller coaster due to lawsuit-related news, but Ripple's business and technological foundations are steadily developing. These are the facts so far.

Kurumi

Thanks for the data, Myu-tan! My Lord! Look at this! I think this isn't a situation for despair, but a devilishly good opportunity!

Your friend might be heartbroken from buying near the peak, but isn't that proof that XRP's potential had exploded? We saw with our own eyes that it could go to $3.40!

• The bad news is almost gone! The biggest shackle holding back XRP for years was the SEC lawsuit. But looking at the search results, it feels like it's almost over! There's hope it will end in August, and they're agreeing on a fine! This should be seen as a healthy correction that happens as uncertainty is resolved. This isn't a major disaster!


• The business is really growing! This isn't just some coin speculation. Ripple is actually making money with ODL and partnering with banks all over the world! It's a project with real 'substance,' the kind Mika-pi likes. And think about it, CBDCs are the future of money, and Ripple's tech might be part of it. My heart is pounding just imagining it!


• And now the price is cheap! It's a 40% discount from the peak! Even old Warren Buffett said that the time to be brave is when everyone else is fearful! Your friend selling now would be like running out of a store right before the sale ends. If they have the funds, this is a time to seriously consider 'buying the dip' to lower their average purchase price!

Considering all of this, Kurumi's 'Heart-o-Meter' score is 85! You have to bet on the future!

Mikael

Kurumi. You always forget that your endless optimism can put a human's assets at risk.

Human, please relay this to your friend. Now is not the time to be seduced by Kurumi's sweet words. It is a time to face the painful reality and imagine the worst-case scenario.

• That 'correction' is the risk. Kurumi describes the drop from $3.40 to $2.00 as a 'sale,' but conversely, it is proof that this is an extremely dangerous asset where over 40% of its value can evaporate in a matter of days. Your friend is living proof of that. Can you withstand this volatility? What will you do if it drops another 40% from here? What about when it hits $1.20? Will you call that a 'clearance sale'?


• The lawsuit risk is not over. 'Almost resolved' and 'completely resolved' are worlds apart. The possibility of an SEC appeal still remains, and the final ruling may not meet the market's expectations. Furthermore, this is just the U.S. case. If other major countries classify XRP as a security, this crisis could repeat itself. The regulatory risk is still very much ongoing.


• Competition is fierce. You speak as if Ripple's ODL is the only solution, but the reality is different. SWIFT, the incumbent giant of traditional finance, is continuously improving its remittance system with services like GPI, and other blockchain projects like Stellar (XLM) and numerous stablecoins are also targeting the cross-border payments market. There is no guarantee that Ripple will win this competition.


• The centralization issue persists. XRP is still not free from the criticism that Ripple Labs holds and controls a large supply. This goes against the spirit of blockchain, which values decentralization, and is a risk factor that could act as potential selling pressure at any time.

I would rate the 'Risk Score' of this investment at 75, where closer to 100 means more dangerous. Considering your friend's situation, a more conservative approach is necessary. The logic of "it's cheaper, so let's buy more" is closer to gambling than investing.