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Ripple’s XRP Token Sees Significant Increase in Open Interest
Ripple’s XRP token has experienced a substantial rise in open interest, reaching close to $1 billion over the weekend. As of the current data from CoinGlass, the token’s price is hovering around $0.61. This surge in open interest reflects growing market activity and interest in XRP.
What’s Different About XRP Price Action?
Unlike Bitcoin (BTC) and Ethereum (ETH), which have seen declines of 1.5% and 2.3% respectively over the past week, XRP has risen by 4.1% in the same period. Several factors contribute to this unique price action for XRP.
One significant factor is the recent launch of a closed-end XRP Trust by digital asset manager Grayscale Investments in the US. This trust allows institutional investors to gain exposure to XRP, one of the top ten cryptocurrencies by reported market cap.
Rising Institutional Interest
The Grayscale XRP Trust has surged by over 11% within a week, indicating strong institutional demand for the seventh largest crypto-asset. This development has also sparked speculation about the potential approval of an XRP exchange-traded fund (ETF) in the near future. If approved by the US Securities and Exchange Commission (SEC), it would be the third digital asset to have its own ETF.
Anticipated Stablecoin Launch
Another crucial development in the Ripple ecosystem is the upcoming launch of its USD-pegged stablecoin, RLUSD. Currently in private beta testing on both the XRP and Ethereum networks, this stablecoin is closely monitored by crypto analysts. Recently, 480,000 RLUSD was minted at the RLUSD Treasury, signaling active development before its integration into Ripple’s services, including cross-border payment products. The stablecoin is also expected to be utilized in decentralized finance (DeFi) protocols across blockchains.
Implications of Rising Open Interest
Data from CoinGlass reveals that open interest in XRP surged to over $1 billion over the weekend, although it has since fallen to approximately $945 million at the time of writing. The spot trading volume in the last 24 hours stands slightly above $2 billion.
A rise in open interest typically indicates increased market activity, suggesting that more contracts are being opened. This may signal expectations of a price move in either direction, depending on market sentiment. Notably, XRP’s open interest was last recorded around the $1 billion mark in March 2024.
Price Action and Market Sentiment
Crypto analysts have varied opinions on XRP’s price action. Ripple Labs’ recent legal victory over the SEC has provided optimism for altcoin bulls. One analyst predicts that if XRP overcomes key resistance levels, it could surge to between $16 and $20.
Meanwhile, another analyst, Carl Runfelt, has pointed out a multi-year bullish triangle pattern on XRP’s chart. He suggests that if XRP breaks this pattern and goes parabolic, it could rise by more than 200% within weeks.
However, if XRP fails to decisively break through the $0.60 resistance level, it could retest the $0.55 support level. Currently, XRP is trading at $0.61, down 1.6% in the past 24 hours.
Conclusion
Ripple’s XRP token is witnessing significant market activity, driven by institutional interest and upcoming developments within the Ripple ecosystem. With rising open interest and potential bullish patterns, XRP remains a token to watch closely in the coming weeks.
