- XRP funding rate dropped to negative 0.012%, reflecting bearish sentiment but signaling potential for sharp reversals.
- Open interest remains low at 591 million coins, showing reduced trader commitment amid uncertain price direction.
- XRP options volume surged over 120%, suggesting rising bets on volatility and a possible shift in market momentum.
XRP’s funding rate has dropped to negative 0.012 percent, a level not seen since the token traded near $0.33. This shift reflects a bearish sentiment in the market, where traders holding short positions are now paying those holding long positions. Historically, such moves have preceded periods of sharp price movement.
Despite the negative funding rate, XRP remains above the $2.10 support level. The asset has lost 14.5 percent over the past week but continues to hold above this key psychological threshold. Traders appear cautious, waiting for clearer market direction, as shown by low open interest and subdued volume levels.
Open Interest and Spot Volume Signal Market Caution
The total open interest for XRP matches 591 million coins whose estimated value reaches $1.18 billion. Since major rallies the current open interest level registers as low. The daily spot trading volume for XRP stands at 107 million coins, while open interest measures 591 million coins worth approximately $1.18 billion. This data indicates traders currently reserve their trading activities for anticipated stronger market trends.
Data from Coinglass shows a drop in XRP’s futures market, with derivatives volume down by 17.62 percent to $7.12 billion. Futures open interest has also fallen by 3.67 percent, now standing at $3.56 billion. However, the options market is experiencing a notable increase. Options volume has surged by 120.23 percent to $7,500, while open interest jumped by 146.96 percent to $983,490.
Potential for Short Squeeze as Market Readjusts
With funding rates in negative territory and options activity increasing, XRP is showing signs of potential volatility. A rapid upward price movement could force short sellers to close their positions at higher prices, triggering a short squeeze. Similar setups in the past have resulted in sharp rallies across crypto markets.
Current market trends affect XRP’s trading value. The value of Bitcoin moving down to $81,000 made investors sell many alternative coins such as XRP. XRP price movements depend strongly on how the general market feels and how Bitcoin behaves.
