Will ‘Liberation Day’ tariffs send XRP below $2? 
Cryptocurrency Apr 2, 2025 Share
There is a distinct possibility that XRP below $2 could soon become a reality.
Donald Trump’s ‘Liberation Day’ tariffs are set to be announced later today. While duties levied on imports don’t have a direct effect on the cryptocurrency market, they do have an indirect effect — which has proven to be no less impactful.
Simply put, the budding trade war brings resurgent fears of inflation, increases the possibility of recession, and decreases the odds of long-awaited rate cuts. This tends to make investors more than a little skittish — resulting in a risk asset selloff and a pivot to more conservative holdings.
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At press time, XRP was changing hands at $2.12. A 14.02% drop on the weekly chart has brought year-to-date (YTD) gains down to 1.91%.
XRP price 1-week and year-to-date (YTD) charts. Source: Finbold
Despite a landmark legal victory, recent events have not provided enough of a catalyst to sustain an upward trajectory for the digital asset. The token has lost roughly $26 billion in market capitalization since the conclusion of the SEC case.
At present, the $2 mark represents a crucial and psychologically important support level. Ahead of the tariff announcements, crypto traders seem to have turned bearish. The possibility of XRP’s price falling below $2 is becoming increasingly plausible, especially if investors continue to offload risk assets.
Short ratio and supply dynamics could send XRP price below $2
On April 1 and April 2, short positions outnumbered long positions, per data retrieved by Finbold from CoinGlass. To be more precise, at present, the long/short ratio of XRP stands at 0.93, with 51.62% of newly opened positions being short sales.
XRP short ratio chart. Source: CoinGlass
In addition, on April 1, Ripple unlocked 500 million XRP — and with 500 million more well on the way, supply and demand dynamics could exert additional downside pressure.
While the present outlook remains bearish, the token’s long-term prospects appear to be intact, at least per technical analysts, as independent signals provider Investing Scope recently highlighted a possible channel up formation. If legitimate, the pattern could outline a pathway to levels as high as $6.50.
XRP price chart with channel-up chart pattern. Source: Investing Scope on TradingView
With that being said, readers should exercise caution in the near term, as significant volatility is expected in the coming days.
Featured image via Shutterstock
