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Crypto Potato 2025-12-25 16:16:55

XRP Leverage Unwinds as Speculators Exit, Open Interest Hits 2024 Lows

Ripple (XRP) open interest (OI) on cryptocurrency exchange Binance has fallen to its lowest level since the end of 2024, amidst a clear rebalancing in the derivatives market. Data compiled by CryptoQuant shows that open interest has dropped to around $453 million, indicating a substantial decline in the use of leveraged positions and a shift in trader behavior. Reset in XRP’s Derivatives Market Earlier in 2025, XRP futures OI surpassed $1 billion on multiple occasions. This period coincided with strong price rallies and increased speculative activity. Such high levels evidenced heavy participation from traders using leverage, which increased the market’s sensitivity to sharp and sudden price movements. A similar pattern emerged again in mid-2025, when OI climbed back above the $1 billion mark. This pointed to renewed speculative interest and continued reliance on derivatives. However, the current market structure has changed significantly. CryptoQuant found that OI has been trending lower over time before dropping more sharply to its current level. This means a considerable withdrawal of short-term speculative traders from the market. The decline in OI has had a direct impact on XRP’s recent price behavior. Lower risk appetite and reduced momentum in the derivatives market have contributed to volatile price action, particularly in the absence of strong liquidity-driven breakouts. At the same time, CryptoQuant observed that the contraction in OI reduces the chances of forced liquidations, which are more common during periods of excessive leverage. Previous instances have shown that phases of low OI have often represented transitional periods in the market. During such phases, trading activity tends to move away from highly speculative, leverage-driven behavior toward conditions that rely more heavily on genuine spot market demand. Mixed Market Signals The structural reset comes at a time when XRP’s decline has pushed it below several crucial support levels, including $2.00 and $1.90. The altcoin is now hovering around $1.87. While analyst Ali Martinez warned that losing $1.90 could lead to further downside, on-chain data suggests mixed signals. Santiment stated that rising bearish sentiment has historically preceded price recoveries for XRP. Meanwhile, Crypto Whale data shows large holders may be accumulating again, as spot taker CVD indicates buying pressure is stronger than selling. The post XRP Leverage Unwinds as Speculators Exit, Open Interest Hits 2024 Lows appeared first on CryptoPotato .

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