As an analyst, I’m observing that XRP (XRP) is experiencing a phase of price exploration, which it hasn’t done since 2017. This digital coin has managed three months straight of green candles, a rare occurrence for just the second time in its existence. The current streak stands out more prominently compared to the one that occurred between March and May 2017.
On specific trading platforms, the altcoin has reached a fresh record peak. If it manages to surpass $3.40, this will undoubtedly validate its new all-time high.
XRP’s open interest rose by $6 billion in 16 days
The value of open interest for XRP has hit a record peak of $7.9 billion, marking a 27.34% surge over the last day. Simultaneously, the volume of futures contracts has doubled, standing at an impressive $42.87 billion as per CoinGlass statistics.
Starting January 1, the open interest for XRP has tripled, growing from $1.92 billion at the start of 2025. Contrary to popular belief, the surge in the futures market hasn’t significantly contributed to XRP’s steep ascent. Instead…
Dom, a specialist in on-chain analysis, emphasized that the surge in XRP’s price seems to be “based on spot trading.” In contrast to spot cumulative volumes delta (CVD) and perpetual CVD, he explained that while these indicators show an indirect relationship.
“Perps have faded every single pump and jumped into shorts on every since pullback.”
From my perspective as a crypto investor, I conducted a closer look at the situation using futures data analysis. Notably, the funding rate stayed steady throughout January. However, what caught my attention was the significant surge it experienced during XRP’s early surge back in November 2024.
Instead of this: On the other hand, accumulated spot trading volumes increased, supporting Dom’s theory that XRP’s surge was due to spot-based activity. Moreover, a negative overall premium on open interest suggested that the futures market has been opposing an increase in XRP prices. In essence, we are witnessing a struggle between bullish positions in the spot market and bearish positions in the futures market.
You could say: On the contrary, there was a rise in total spot transactions, indicating that Dom was correct about the XRP rally being caused by spot-focused activity. Additionally, a downward premium on open interest indicated that the futures market has been resisting an increase in XRP prices. Essentially, we are seeing a battle between optimistic positions in the spot market and pessimistic positions in the futures market.
XRP exchange reserve on the rise
In the midst of the market’s excitement, it’s worth mentioning that the XRP exchange reserve has been gradually growing over the last few weeks. According to CryptoQuant, XRP holdings on Binance have risen by about 10% since December 16. Interestingly, these reserves decreased significantly in early November when XRP’s price was experiencing a surge.
It means that investors are indeed cashing in their profits, however, the daily reserves at the exchange remain below the annual average for the year 2024.
Currently, Santiment – a data analysis tool – is pointing out a significant increase in XRP transactions by large investors (whales), which is the highest it’s been in about six weeks. On their platform, they’ve noted this trend.
“We have just seen 2,365 $100K+ XRP transactions in the latest 8-hour span, the highest spike since December 34th. Total holders are also skyrocketing.”
This piece is meant to provide a broad understanding; it’s not meant to serve as legal or financial guidance. The perspectives, beliefs, and viewpoints shared in this article belong solely to the writer and may not mirror those of CryptoMoon.
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2025-01-16 22:33