Is XRP's Dismal Decline a Sign of Altcoin Traders' Surrender? 🤔

It is with no small measure of astonishment that I must report the recent decline of XRP (XRP), which has plummeted by a staggering 16.8% between the dates of February 23 and February 26. This unfortunate turn of events has resulted in a rather alarming $79 million in leveraged long futures liquidations. One might ponder how such a correction could transpire amidst a regulatory atmosphere that is, by all accounts, rather favorable, and the increasing likelihood of a spot XRP exchange-traded fund (ETF) being approved in the United States. Alas, the whims of the market are as unpredictable as a Regency ball! 🎭

Simultaneously, the open interest in XRP futures has descended to its nadir for the year 2025, suggesting that traders have been unwinding their leveraged positions with a fervor that would make even the most ardent of romantics weep. While this shift does not necessarily indicate a widespread bearish sentiment, it does raise the rather pressing question of whether XRP’s once-bullish momentum has indeed faltered. 😬

The aggregate open interest in XRP futures has now dwindled to a mere XRP 1.33 billion, marking an 8% decline from the previous week. In a rather amusing comparison, the open interest for SOL has also fallen by 4% during the same period, while the futures market for DOGE has remained as flat as a pancake. 🥞

To ascertain whether traders are indeed losing interest in XRP, one must delve into the funding rate of perpetual contracts (or inverse swaps, if you will). This rate, which exchanges charge to balance the demands of leverage, turns positive when long (buy) positions pay to hold, thus signaling a bullish sentiment. Conversely, a negative rate suggests a rather gloomy outlook. How delightfully complicated! 😏

XRP’s 8-hour funding rate has remained stubbornly near zero since December 9, indicating a rather balanced demand for leverage between the bulls and bears. The last brief surge in leverage demand occurred on December 4, 2024, following a remarkable 140% rally in XRP’s price over a fortnight. However, this peak in buying pressure was swiftly followed by a sharp 22% correction in less than three days—oh, the irony! 😅

On December 3, 2024, the funding rate lingered below 0.05% per 8-hour period, which translates to a mere 0.45% per month. This suggests that leverage buyers had already positioned themselves with a certain aggressiveness before the inevitable correction. How very forward-thinking of them! 🙄

Reduced XRP demand shows uncertainty over spot ETF approval and SEC case resolution

The current market conditions are, I daresay, a far cry from those of December 2024. XRP’s last rally occurred between February 12 and February 15, when its price surged by 17% from $2.41 to $2.83. Yet, the funding rate data reveals no increase in leveraged demand, suggesting that either XRP holders have become overly optimistic following their strong gains in late 2024 or have shifted their affections to other cryptocurrencies. How fickle! 💔

One cannot overlook the dampening enthusiasm among XRP traders due to the ongoing lawsuit from the US Securities and Exchange Commission (SEC) against Ripple. While the SEC has graciously withdrawn cases against Coinbase, OpenSea, Robinhood, and Uniswap, Ripple remains an unfortunate exception. This presents a double-edged sword for XRP, where prolonged uncertainty weakens investor conviction, yet a surprise positive resolution could ignite a rally of epic proportions. What a delightful conundrum! 😆

John Reed Stark, the former Chief of the SEC’s Office of Internet Enforcement, has previously accused the cryptocurrency industry of spreading myths to mask its lack of transparency and accountability. He recently commented on the “demolition of the SEC Crypto-Enforcement Program” on X, using a meme to express his frustration over recent developments. How very modern of him!

2025-02-27 01:42

Is XRP’s Dismal Decline a Sign of Altcoin Traders’ Surrender? 🤔

Reduced XRP demand shows uncertainty over spot ETF approval and SEC case resolution

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