XRP's futures open-interest dropped by $2.4 billion after a 15% price correction lately. However, leveraged positions are still high.
Futures premiums indicate a lot of neutral sentiment, which means that there is no current panic among institutional traders.
On-chain metrics show weak adoption of the XRP Ledger in DeFi and tokenized assets compared to competitors.
Technical indicators show that a recovery is possible if XRP breaks above $3.20, but risks of a deeper drop still exist.
XRP recently saw a 15% decline in price after falling from a high of $3.66 on July 18 to around $3.12.
This drop came with a sharp $2.4 billion reduction in open interest for XRP futures. It is now raising questions among traders and analysts about whether a deeper crash could follow.
Despite the correction, XRP's futures market continues to show a neutral sentiment, which shows that investors aren’t entirely bearish. Could a price crash be next?
During XRP’s explosive 68% rally from $2.17 to $3.66 between July 1 and July 18, futures open interest hit an all-time high of $11.2 billion.
Open interest is unwinding | Source: Coinglass
Since then, it has dropped to $8.8 billion, which is a 21% fall in dollar terms. When measured in XRP tokens, the decline is around 12% and shows that traders have reduced their leverage but have not completely exited their positions.
This partial unwind could mean that many of the extreme bullish bets may already be cleared, especially after $325 million in liquidations over the past two weeks. Still, open interest in XRP futures remains 48% higher than it was a month ago. In other words, leveraged traders are still in the game, and volatility could come back soon.
To get a better sense of market mood, analysts often look at futures premiums, especially the annualized premium on 3-month contracts. These typically range from 5% to 10% above spot prices in neutral markets.
XRP’s annualized futures premium | Source: Laevitas
XRP futures have recently traded at a 6–8% premium, even after the price dipped below $3.60 and briefly tested support around $3.
This steady premium indicates that the market is neither strongly bullish nor panicking. Moreso there are no immediate threats of mass liquidations. Not unless the price sharply drops again.
Part of the optimism around XRP’s price earlier in July was based on a possible spot XRP ETF approval in the U.S.
This is especially after Ethereum-based ETFs crossed $18 billion in assets under management. As of writing, hopes are high that altcoins like Litecoin, Solana, and Cardano might benefit from similar ETF hype, and XRP is seen as a candidate.
However, the positive sentiment has also been on the rise, mostly by misleading social media posts.
These reports feature rumors of Ripple entering partnerships with major banks and the SWIFT banking system, which have not been supported by any credible sources so far.
While the price action may indicate that interest in XRP is strong, the underlying activity on the XRP Ledger tells a different story.
XRP ranks 11th in RWA | Source: RWA.xyz
According to data from RWA.xyz, the platform holds only $134 million in tokenized assets, which is far below competitors like Avalanche with $190 million. This places XRP well outside the top ten networks in real-world asset tokenization.
DEX activity on the XRP Ledger is also weak. XRP’s DEX volume doesn't even rank among the top 50 blockchains. While this is happening, other networks like Sui and Sei processing billions in trades over the same period.
These numbers indicate that the XRP Ledger, while being known for its fast and cheap transactions, has not yet gained much ground in the defi space.
On the technical side, XRP is trading just below the $3.20 resistance and its 100-hour SMA. The cryptocurrency, after finding support near $3.08, has bounced slightly and broken a short-term bearish trend line around $3.12.
XRP and its current price action | Source: TradingView
If XRP can reclaim the $3.20 level and hold above it, there’s a possibility of a move toward $3.25 and possibly up to $3.35 or $3.40. However, if it fails to break above $3.20, another leg down could push it to $3.02 or even retest the psychological $3.00 support level.
Even though the futures market does not show signs of panic right now, XRP is still vulnerable. If the price drops below major support levels and open interest stays high, it could trigger another round of liquidations.
Traders are continuing to watch the $3 and $2.60 levels as tipping points. Because a break below these could invalidate any short-term bullish setup and possibly kickstart a deeper retracement.
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