Market turbulence hits Solana and XRP as scandals and regulatory uncertainties shake investor confidence.

Solana's Descent: Political Scandals and Memecoin Mayhem

Solana (SOL) has had a rough start to 2025, plunging more than 40% in just a month. The primary driver behind this decline? A perfect storm of political scandal, market sell-offs, and the lingering volatility of memecoins.

In a new development, an Argentine judge was assigned to investigate President Javier Milei's role in promoting a cryptocurrency that crashed https://t.co/z9C0uJbzlB pic.twitter.com/k1ofHjKF1w

— Reuters (@Reuters) February 18, 2025

The trouble started when Argentine President Javier Milei openly endorsed LIBRA Libra Libra is a yet-to-be-released cryptocurrency proposed by Facebook, Inc., that will aim to serve as a global payment system and a stable financial infrastructure that people across the world can use. The projected release date of the libra cryptocurrency is currently slated for 2020, while the project is currently being managed by the Libra Association.Headquartered from Geneva, Switzerland, the Libra Association main purpose is founded on three pillars.This includes the provision of a framework Libra is a yet-to-be-released cryptocurrency proposed by Facebook, Inc., that will aim to serve as a global payment system and a stable financial infrastructure that people across the world can use. The projected release date of the libra cryptocurrency is currently slated for 2020, while the project is currently being managed by the Libra Association.Headquartered from Geneva, Switzerland, the Libra Association main purpose is founded on three pillars.This includes the provision of a framework Read this Term, a Solana-based memecoin that quickly became a cautionary tale in the crypto world. What initially seemed like a strong show of support from a sitting world leader turned into a nightmare when LIBRA’s market cap plummeted from $4.5 billion, losing 90% of its value. The project turned out to be a textbook pump-and-dump, leaving many retail investors empty-handed.

This spectacular collapse triggered a wave of sell-offs across the Solana network. Solana had already been riding high after a strong performance in late 2024, but the memecoin fiasco shattered investor confidence. Adding fuel to the fire, Milei himself is now facing legal action, with multiple lawsuits filed by Argentine lawyers alleging financial misconduct related to the LIBRA scandal.

Despite the chaos, some analysts remain optimistic, arguing that Solana’s fundamentals remain strong. VanEck, Bitwise, and Pantera Capital have all suggested that that SOL could still rally, with VanEck claiming it could reach $520 by the end of 2025 if the current turbulence subsides and institutional interest remains strong.

XRP's Slump: Regulatory Rollercoaster and Political Letdowns

If Solana’s downfall was fueled by scandal, XRP’s woes stem from regulatory uncertainty and political letdowns.

XRP, which had a promising start to 2024, has dropped 3.6% to $2.59, marking a 19% decline over the past month. Much of this decline has been attributed to a mix of SEC-related concerns and fading optimism around crypto-friendly policies from the new Trump administration.

Trump just posted about #XRP. I checked it out. It’s still there 🚀 pic.twitter.com/XTlg8MQJQM

— CryptoBull (@CryptoBull2020) February 19, 2025

One of the biggest hopes for XRP was the approval of an XRP Exchange-Traded Fund (ETF) Exchange-Traded Fund (ETF) An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e An exchange-traded fund (ETF) is a collection of a mixture assets, i.e. stocks, commodities, bonds, or cryptocurrencies that tracks an index or underlying portfolio of investments.Of note, an ETF functions an arbitrage mechanism that is designed to keep it trading close to its net asset value. Most tradable ETFs track a specific index. This most commonly mirrors a stock or bond index. The popularity of ETFs has grown in recent years and are seen as an attractive investment due to its low cost, e Read this Term, which would have allowed institutional investors to gain exposure to XRP without directly buying the token. While analysts believe an approval could lead to huge inflows, the SEC has so far delayed any clear decision.

Adding to XRP’s troubles is the Trump administration’s unpredictable stance on crypto regulation. While candidate Trump hinted at potential pro-crypto policies—at one point even teasing a Bitcoin strategic reserve—his government’s actions so far have been lackluster. In fact, Trump’s new round of tariffs on Canada, Mexico, and China has triggered broader market fears, leading to a general risk-off sentiment in crypto.

The ETF Tease: Hope on the Horizon?

Despite the bearish sentiment, some crypto bulls argue that XRP and Solana still have a chance to recover, thanks to potential ETF approvals.

💥JUST IN: 🇺🇸 SEC acknowledges filing for Bitwise spot $XRP ETF. pic.twitter.com/KVAygLPYrS

— Amonyx (@amonbuy) February 18, 2025

Regarding XRP, the SEC is reviewing multiple ETF applications from Grayscale, Bitwise, and more, and if approved, institutional investors could potentially inject vast sums. High levels of liquidity could significantly reverse the current downward trajectory.

Solana, too, has ETF potential, with investors showing interest in bringing a regulated Solana fund to the market. If approved, an ETF could help restore confidence in the ecosystem and push Solana higher. However, given recent controversies, regulators may be hesitant to greenlight anything related to Solana in the near term.

Proceed with Caution

While some long-term investors remain hopeful, the short-term outlook for Solana and XRP remains volatile.

Solana’s price may continue to feel the aftershocks of the LIBRA scandal, especially if the lawsuits against Milei gain traction. If more memecoins on Solana collapse, investors may start questioning the network’s ability to support long-term, serious projects.

XRP, on the other hand, is still caught in the regulatory crossfire. The SEC’s stance on crypto remains unpredictable, and until XRP gets clear regulatory approval—particularly in the form of an ETF—its price may remain stagnant.

For now, crypto investors should brace for more turbulence. Between political scandals, regulatory hurdles, and global market jitters, the coming months could be make-or-break for Solana and XRP.

One thing is clear: crypto is never boring.