XRP has started the year with strong momentum, outperforming much of the broader crypto market. The rally has been supported by solid ETF inflows, improving market sentiment, and declining token balances on major exchanges.
The payment-focused cryptocurrency has gained significant attention after being described by CNBC as the new “cryptocurrency darling.” XRP jumped 25% in the first week of the year, far outpacing both Bitcoin and Ether.
During a recent broadcast, CNBC’s Power Lunch host Brian Sullivan said that XRP has become the standout trade of early 2026, eclipsing the performance of the two largest cryptocurrencies by market value.
XRP outperforms major cryptocurrencies
Since the start of January, XRP has risen 25%, compared with a 6% gain in Bitcoin and a 10% increase in Ether. The strong relative performance has drawn renewed interest from both retail and institutional investors.
Several factors appear to be driving the rally. These include growing interest in XRP-focused exchange-traded funds, improving social sentiment, strengthening on-chain fundamentals, and a series of strategic partnerships announced by Ripple.
Analysts caution, however, that ETF-driven inflows and social-media enthusiasm can be volatile. Past XRP rallies fueled by narrative momentum have often cooled once inflows slowed or broader market conditions shifted.
On-chain indicators, such as declining exchange balances, can also reverse quickly during periods of heightened volatility. In addition, regulatory and macroeconomic developments remain key external risks that could weigh on prices despite the strong start to the year.
ETF inflows support XRP momentum
ETF activity has played a central role in XRP’s recent strength. CNBC host Mackenzie Sigalos noted that investor behavior around XRP ETFs has differed from that seen in spot Bitcoin and Ether funds.
During the final quarter of last year, many investors accumulated XRP ETF exposure while prices were subdued. This positioning allowed for sharper percentage gains when prices rebounded in early January, as XRP was viewed as a less crowded trade compared with Bitcoin and Ether.
Data from Coinglass shows that the four spot XRP ETFs have attracted nearly $100 million in inflows since the beginning of the year. Total inflows now stand at around $1.15 billion, with no recorded outflow days so far.
Bullish sentiment and improving on-chain activity
Social sentiment around XRP has also turned positive. According to Market Prophit, an AI-based social analytics platform, both retail sentiment and so-called smart money sentiment are currently bullish.
On-chain data further supports the narrative. XRP balances held on Binance have fallen to their lowest level in two years, based on data from CryptoQuant. Lower exchange reserves are often interpreted as a sign that fewer holders are preparing to sell.
Network activity has also accelerated. Transaction volumes on the XRP Ledger have increased by more than 50% over the past two weeks, according to XRPscan, pointing to rising usage and engagement.
Ripple expands footprint in Japan
Ripple has also continued to expand its presence in Asia. The company recently announced partnerships with major Japanese financial institutions, including Mizuho Bank, SMBC Nikko, and Securitize Japan, aimed at boosting adoption of the XRP Ledger in Japan.
In December, Ripple received conditional approval from the Office of the Comptroller of the Currency to establish Ripple National Trust Bank.
Ripple President Monica Long told Bloomberg that the company’s November fundraising round and $40 billion valuation were strong positive signals, though she noted that there are currently no immediate plans for an initial public offering.
