- A seven-year double-bottom pattern has been confirmed as broken.
- There is a 95% probability that approval of a spot ETF would influence market sentiment.
- The market-cap-to-TVL ratio for the XRP Ledger stands at roughly 2,200.
XRP has surged more than 550% since November, topping $3 on Tuesday and sparking debate across the crypto market about its next major milestone.
Technical analyst Gert van Lagen has highlighted a long-term chart pattern suggesting the token could reach $34 by mid-2026.
That projection relies on the completion of a multi-year double-bottom structure, a bullish formation often followed by substantial price moves.
Historic precedents, recent legal developments, and strong expectations for ETF approval are also shaping investor sentiment, although on-chain metrics point to valuation risks that could temper the rally.
XRP is currently trading at $3.19, down 0.79% in the past 24 hours.
Technical breakout points to a multi-year advance
According to Van Lagen, XRP has broken out of a seven-year double-bottom pattern after clearing neckline resistance near $1.80.
That breakout was followed by a retest of the neckline, which has since acted as support.
In technical analysis, such a successful retest is often read as confirmation of a robust breakout.
Using a 2.00 Fibonacci extension, the measured move projection from this formation targets $34 by mid-2026.
This setup resembles XRP’s price action from 2014–2017, when a similar long-term base preceded a parabolic rally of more than 100,000%.
XRP markets have produced multiple large gains historically, including a 1,072% rise from the 2022 lows and a 1,625% increase during the 2020–2021 cycle.
Market drivers behind XRP’s rally
The 2020–2021 rally coincided with near-zero interest rates in the U.S., while the current gains have been driven by positive developments in Ripple’s legal proceedings, increasing regulatory clarity, relistings on exchanges and optimism around a spot XRP exchange-traded fund (ETF).
In 2025, sentiment has been particularly swayed by forecasts indicating a 95% chance of spot ETF approval.
Analysts argue that if a spot ETF is approved, XRP could climb toward $27, moving it closer to Van Lagen’s $34 target.
The ETF narrative has sustained bullish momentum this year, with traders anticipating potential inflows of institutional capital.
In prior cycles, major inflows often coincided with regulatory milestones, producing sharp short-term price spikes.
On-chain metrics flag potential overvaluation risks
Despite the strong rally, on-chain data raise important concerns.
The XRP Ledger (XRPL), the blockchain behind XRP, shows far lower activity levels than other major layer-1 blockchains such as Ethereum.
DefiLlama data indicate that while XRP’s market capitalization is about $190 billion, its total value locked (TVL) is only $85 million, implying a market-cap-to-TVL ratio near 2,200.
By comparison, Ethereum’s ratio is roughly 5.6, even though XRP’s market value is around 40% of Ethereum’s.
Another potential risk is that more than 95% of XRP’s circulating supply is currently in profit, according to Glassnode.
Historical data show that such high levels of realized profit often precede meaningful price corrections as profit-taking intensifies and selling pressure rises.
That pattern appeared during the 2020–21 and 2022–25 cycles, when similar conditions led to pullbacks.
While technical patterns and market drivers currently support a bullish case for XRP, the mismatch between valuation and on-chain activity, combined with elevated potential for profit-taking, suggests that sustaining a move toward $30 and beyond could encounter significant resistance.