This article is also available in Spanish.
Ripple’s XRP token collected nearly $1 billion in open interest over the weekend, while its price hovered around $0.61 at press time, data from CoinGlass shows.
What’s Different About XRP Price Action?
While the top two cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH), fell 1.5% and 2.3% last week, XRP rose 4.1% during the same period. Several factors could explain XRP’s counter-intuitive price action.
For example, digital asset manager Grayscale Investments recently launched a closed-end XRP Trust in the US, which allows institutional investors to gain exposure to one of the top ten cryptocurrencies by reported market cap.
Related Reading
Grayscale’s Trust grew more than 11% during the week, pointing to strong demand for the seventh largest crypto-asset institution.
The launch of Trust also fueled speculation about the possible approval of an XRP exchange-traded fund (ETF) in the near future. If the US Securities and Exchange Commission (SEC) approves an ETF based on XRP, it will be only the third digital asset to have its own ETF.
Another important development in the Ripple ecosystem is the expected launch of its USD-pegged stablecoin, RLUSD. Currently, crypto analysts at X are closely watching the stablecoin in private beta testing on both the XRP and Ethereum networks.
According to the latter review480,000 RLUSD was made in the RLUSD Treasury, showing the active development of the stablecoin before its integration with Ripple’s services, including its cross-border payment products. The stablecoin can also be used in financial protocols (DeFi) on all blockchains.
The Implications of Rising Interest Rates
The data from CoinGlass shows that open interest in XRP rose to over $1 billion over the weekend before falling to around $945 billion at press time. Spot trading volume in the past 24 hours is just over $2 billion.
An increase in open interest usually indicates an increase in market activity, which suggests that more contracts should be opened. This may indicate the expectation of price movement in either direction, depending on the prevailing market sentiment. Notably, XRP open interest was last recorded at around the 1 billion mark in March 2024.
As for price action, crypto analysts have divided opinions on XRP. Ripple Labs’ recent legal victory over the SEC has given hope to altcoin bulls, and one analyst. prediction that if the token overcomes important resistance levels, it could rise to between $16 and $20.
Related Reading
Meanwhile, another crypto analyst, Carl Runfelt, highlighted multi-year bullish triangle pattern on the token’s chart. He noted that if XRP breaks the pattern and goes parabolic, it can rise more than 200% within weeks.
On the contrary, XRPs not being able to breaking the $0.60 resistance level strongly would lead the token to retest the $0.55 support level. XRP is trading at $0.61 at press time, down 1.6% in the last 24 hours.
Featured image from Pixabay, charts from CoinGlass.com and Tradingview.com