Thanks to regulatory clarity and related upcoming technical changes, XRP-tracked futures are nearing new heights as open interest zoomed towards record highs on Saturday, following a 24% spike in prices in just 24 hours. Consequently, XRP and US dollar-denominated open interest are at record levels as of Sunday, with over 2 billion tokens (valued at nearly $2 billion at current prices) in futures.
XRP Price Surge While XRP Futures Hit Record OI
Long/short data shows that traders are slightly biased towards shorts, with about 51% of bets pitched against further price increments. Analysts claim that the ratio should theoretically remain 50:50 at all times as there is always a short trade for each long trade. However, the bias provides insights into how savvy traders are positioning over a very short-term period, say, a 24-hour window.
Open Interest (OI) describes the total number of outstanding derivative contracts not settled for an asset. An increase in both Open Interest and prices demonstrates that the market is receiving new funds – a clear sign of a bullish trend. On the contrary, if the price rises but OI falls, the rally may be driven by short covering, rather than new buying, potentially signaling weaker cryptocurrency market trends.
XRP prices zoomed above $1.2 in the US on Saturday morning hours, taking weekly gains to over 87% to set a three-year price high for the token. Per CoinDesk reports, XRP gains began late on Thursday as 18 US states filed to sue the SEC and commissioners, including chairman Gary Gensler, accusing them of "unconstitutional overreach" of the cryptocurrency sector.
Meanwhile, speculative optimism among traders reasons that a crypto-friendly Trump administration could benefit tokens linked to U.S.-based firms like Ripple Labs (Linked to XRP) and Uniswap (UNI). The rationale is that both firms are more involved in boosting value for token holders after regulatory hitches seem to have soft-pedaled.
Additionally, recent gains in XRP futures gains may be related to the upcoming RLUSD stablecoin by Ripple Labs developments, a company closely linked to the issuance of XRP. Ripple reportedly intends to use RLUSD in its cross-border payments product, supplying liquidity and facilitating quicker and cheaper transactions while potentially integrating with various decentralized finance (DeFi) protocols across different blockchains.
Moreover, XRP has beaten a flat bitcoin (BTC) and a 2.7% gain in the broader crypto market tracked by the liquid CoinDesk 20 index (CD20) over the last 24 hours.
Final Thoughts
XRP Futures hit record open interest (OI) amid a $1.2 price surge. The current price surge is reportedly due to improved regulatory clarity and news about an upcoming RLUSD stablecoin project. Additionally, other biases fueling the growth of XRP futures include speculative optimism that a Trump administration would favor the growth of US-based crypto firms like Ripple and Uniswap.