Key takeaways:
XRP’s $190 billion market cap far outpaces XRPL’s onchain activity, trading at 2,200x its TVL.
Bearish RSI divergence hints at a possible drop toward $2.32.
XRP (XRP) has surged by over 600% since November, climbing to a market capitalization of around $190 billion, as the market assesses the Ripple lawsuit settlement, regulatory clarity in the US, and growing ETF momentum.
But with such rapid appreciation, have XRP’s fundamentals kept pace with price? Let’s take a closer look.
XRP’s valuation is 2,200x higher than its TVL
As of Monday, XRP’s parent chain, the XRP Ledger (XRPL), has a total value locked (TVL) of $87.74 million, according to DefiLlama.
XRPL’s decentralized exchange (DEX) volumes were $49,621 in the last 24 hours, while its app fees totaled just $1,467.
Based on these metrics, XRP’s market cap is over 2,200 times its DeFi TVL and around 363,000 times its annualized fee revenue.
For XRP bulls, the current valuation reflects a confident bet on XRPL’s future growth: that settlement volumes, stablecoin growth, corporate treasury allocations and ETF inflows will expand sharply.
In their view, these drivers will justify today’s price levels, even if onchain usage remains comparatively modest for now.
XRPL hosts $175.9 million in tokenized assets, up 52.25% in a month, led by US Treasury debt ($120.6 million), public equities ($55.4 million), real estate ($4.3 million) and stablecoins ($67.3 million), according to data from RWA.xyz.
This rapid growth ranks among the fastest in the Real World Asset (RWA) tokenization sector, hinting at expanding use cases that could boost future XRP demand.
Related: There’s more to Ripple than the ‘XRP Army’: Why the altcoin is a good trade
XRP is admittedly far behind the leading layer-1 blockchain, Ethereum.
As of Monday, Ethereum’s market cap was over $516 billion, with a $92.06 billion TVL, and generating $10.48 million in daily app fees. It also tops the RWA leaderboard with $7 billion in projects under management.
That brings Ethereum’s market cap-to-TVL ratio to 5.6, and its market cap-to-annualized-fee ratio to 135, far lower than XRPL’s.
Yet, XRP trades at nearly 40% of Ethereum’s market cap, prompting some analysts to call it “way overvalued.”
XRP bearish divergence hints at 25% correction
From a technical standpoint, XRP’s recent rally shows signs of slowing momentum.
A growing bearish divergence between its price and the relative strength index (RSI) suggests that buying pressure is weakening even as prices push higher, a setup that has historically preceded corrections.
XRP could face an initial pullback toward its 20-2W exponential moving average (20-2W EMA; purple wave) near $2.32 by September, down over 25% from current prices.
A similar decline occurred following the bearish divergence signals in the 2017–2018 cycle.
The $2.32 level is further notable because it is close to XRP’s realized price over the past six months, essentially the average cost basis at which existing holders acquired their tokens during that period.
XRP’s realized prices could act as magnets if momentum fades, with a retest likely flushing out weaker hands before any rebound.
Some technical analysts are nevertheless confident about XRP price rising to as high as $10 in the coming months.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.