XRP continues to hold firm above the $2 support level, maintaining investor interest despite broader market uncertainty.
While Bitcoin (BTC) struggles for direction, XRP has rebounded strongly, fueled by institutional inflows and growing anticipation of an exchange-traded fund (ETF) approval.
At press time, XRP is trading at $2.73, posting an 11% gain in the past 24 hours and recovering over 8% in the past week, a sharp reversal from the recent market downturn.
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As volatility grips the sector, attention now turns to where XRP will stand by the end of Q1 2025.
To assess XRP’s potential trajectory, Finbold analyzed market trends and consulted DeepSeek AI for its forecast on where the cryptocurrency could be trading in the coming months.
DeepSeek identifies key XRP price drivers
To generate its forecast, DeepSeek AI was prompted with the following query:
“As XRP continues to consolidate above $2 amid growing institutional interest and speculation over a potential ETF approval, where is the cryptocurrency headed by the end of Q1 2025? Considering factors such as the SEC’s stance on Grayscale’s XRP Trust conversion, Ripple’s expanding cross-border partnerships, and the impact of scheduled token unlocks, provide a precise and realistic price forecast with supporting analysis. What key catalysts could drive XRP to new highs, and what risks might limit its upside?”
With its online functionality and DeepThink (R1) enabled DeepSeekK AI quickly assessed market conditions, highlighting key factors influencing XRP’s trajectory.
ETF speculation and regulatory shifts
When prompted, the Chinese AI model pointed to a major regulatory shift, the SEC’s formal acknowledgment of Grayscale’s filing to convert its XRP Trust into an ETF.
While this acknowledgment does not guarantee approval, it signals a shift in regulatory sentiment, increasing expectations for an eventual green light.
Analysts at JPMorgan estimate that an XRP ETF could attract between $3 billion and $6 billion in net inflows within its first year, adding considerable buying pressure to the asset.
In addition to the ETF narrative, the AI model highlighted the long-standing impact of Ripple’s legal battle with the SEC on XRP’s valuation.
However, with a new U.S. administration in office, optimism is building that a pro-crypto stance could pave the way for a favorable resolution, potentially restoring investor confidence and driving fresh demand.
Expanding institutional adoption
Beyond regulatory developments, DeepSeek sees Ripple’s expanding role in global payments as a key driver of XRP’s institutional appeal.
Recently, Ripple partnered with Unicâmbio to facilitate payments between Portugal and Brazil, marking its first expansion in this key remittance corridor. Additional collaborations with Mercado Bitcoin and Travelex Bank further highlight the company’s growing presence in global payments.
Potential risks and market uncertainty
Despite growing optimism, DeepSeek AI warns that several risks could impact XRP’s trajectory in the coming months.
As reported by Finbold, Ripple plans to offload $800 million worth of XRP in February, which could inject volatility into the market by increasing supply.
Meanwhile, broader macroeconomic conditions, including Bitcoin’s performance and Federal Reserve policies, are expected to play a crucial role in shaping XRP’s price action.
DeepSeek predicts the price of XRP for Q1 2025.
With the key factors at play, DeepSeek AI outlined three possible scenarios for XRP’s trajectory in the months ahead.
DeepSeek AI projects that XRP could trade between $3.15 and $3.50 by March 2025 if it clears the key $2.72 resistance, a scenario the model assigns a 65% probability.
However, if regulatory setbacks, such as SEC delays or an ETF rejection, persist, the AI model sees a 25% chance of XRP consolidating between $2.20 and $2.55.
In a more optimistic but less likely scenario expected in Q1, with just a 10% probability, a successful ETF approval and strong institutional inflows could propel XRP toward $4.50 to $5.
Featured image via Shutterstock
