Open Interest on XRP (Ripple) futures contracts is at 2023 highs.
According to Coinglass data, it has exceeded $1.1 billion for the first time even since November 2021.Â
It is therefore a level previously reached and surpassed only during the great bull run of 2021.
Summary
Ripple: the Open Interest of XRP
Open Interest (OI) measures the total exposure of derivative contracts, such as futures and options, that have not yet closed at a specific point in time.
In other words, it is the sum of all open long or short positions at a given instant.
As far as XRP is concerned, the absolute highs of OI were recorded between April and May 2021, i.e., during the first phase of the last big bull run, when they touched $1.5 billion.
The current level is thus not far from the highs, and far exceeds the 2022 high, which is stuck just above 800 million.
In other words, excluding the peaks touched during the bull run, the current level would be the highest ever.
It is worth mentioning that in 2020, before the SEC sued Ripple, the peak for the year was just over 400 million.
The comparison between 2022 and 2020 makes it clear that, regardless of the bull run, there was still a sharp increase, but the comparison between 2023 and 2021 seems to reveal particular optimism about the future of XRP.
It is worth noting that long positions prevail, as opposed to short positions, although not by much.
The price of XRP
On the other hand, the price of XRP is up 5% since yesterday, even +134% since the beginning of the year. Despite this, it is still 79% below the all-time high of January 2018.
After last week’s ruling, the price had risen quickly from $0.47 to $0.83, then retraced slightly to $0.68.Â
However, in the following days instead of continuing the retracement, it registered a small rebound, which first brought it back to $0.72, and then today back above $0.80. Thereafter it seems to have settled just below this level.
It is worth noting that before the filing of the SEC lawsuit, in late 2020, the price had reached as high as $0.66, which is just below the $0.68 touched a few days ago.
During the last big bull run it had risen as high as above $1.8, but later also fell fairly quickly first below $0.6 and then as low as $0.32.
Taking as a reference the very bottom of the last bear-market, the current price is almost 150% higher, and this is mainly due to last week’s ruling. Indeed, before that ruling at the top in 2023 it had reached $0.54.
It is also worth noting that while the $0.68 of a few days ago was not that much higher than the previous yearly high in 2023, the current low $0.80 is instead a significant increase. It is all about whether it will be able to hold this level or not.
The future of XRP
The fact that Open Interest has risen by 21% in the past week suggests that short-term sentiment on XRP’s price trend is positive.
For instance, many are expecting a return to $1, although this is actually only a psychological threshold that has no real reason to exist from a technical point of view. It is enough to mention that in its entire history, the price of XRP has rested on this level only three times.
Many believe that now that the SEC can theoretically no longer block XRP, it will be increasingly used within the banking system, but the final verdict is yet to be made.
For one thing, the court ruling proved XRP right but Ripple wrong, which is the company that created this cryptocurrency and initially sold it as if it were an unregistered investment contract.
Given that the future of XRP depends largely on Ripple, if Ripple were to be heavily condemned, it might have repercussions on the use of the XRP price.
Moreover, the ruling is not final, because the SEC can still appeal.
Hence, the future of XRP still appears uncertain, despite everything, although the current sentiment is positive.
