XRP’s open interest has reportedly dropped to its lowest point since last year, when the altcoin saw a surge of roughly 600%. According to on-chain analytics platform CryptoQuant, this decline could be a positive sign for XRP as it attempts to climb to new highs.
In a blog post, CryptoQuant analyst Arab Chain pointed out that XRP’s open interest on Binance has fallen to its lowest level this year. Analysis of XRP Ledger data shows a clear rebalancing in the derivatives market, with open interest dropping to nearly $453 million—the lowest since late last year.
Arab Chain explained that this shift indicates a change in trader behavior and a significant reduction in the use of leverage compared to earlier periods. Earlier this year, XRP’s price appeared to be driven by leverage, with open interest in its futures contracts repeatedly exceeding $1 billion during strong price rallies.
Open interest rose again in mid-2025 to levels similar to those seen early in the year, leading to considerable volatility for XRP. However, Arab Chain noted the current situation is “markedly different,” with open interest declining gradually and then sharply, suggesting a major exit by short-term speculators.
The analyst outlined two implications of this drop in open interest. First, it reflects declining risk appetite and weakening momentum in the derivatives market, which helps explain the volatile price movements in the absence of strong, liquidity-driven breakouts. Second, this contraction represents a healthy structural shift, as it lowers the risk of forced liquidations and eases the pressures linked to excessive leverage.
Arab Chain added that periods of low open interest often signal transitional phases, where the market moves from a highly speculative environment to a calmer one driven more by genuine spot demand.
Meanwhile, some crypto analysts suggest XRP may be gearing up for another significant rally, though it remains uncertain whether it could repeat last year’s 600% surge. In a post on X, analyst Niels observed that the altcoin is forming a higher low at current levels—a pattern similar to one seen in April this year, just before it reached a new all-time high. He added that a push above $2 could put bulls in control.
Another analyst, Chart Nerd, predicted that XRP could set a new all-time high on its next upward move. He noted the altcoin is in the middle of an ABC reset, with his chart suggesting a potential rise to as high as $4.5 in an expected bullish move during the first half of next year.
At the time of writing, XRP is trading around $1.84, down slightly over the past 24 hours, according to CoinMarketCap data.
Frequently Asked Questions
FAQs XRP Open Interest Drop Potential Price Surge
Beginner Questions
What is open interest in crypto trading
Open interest is the total number of outstanding derivative contracts that havent been settled It shows how much money is currently betting on an assets future price
What does it mean that XRPs open interest has dropped to a low
It means the total value of active futures and options bets on XRP has fallen significantly Fewer traders are holding open leveraged positions which often signals decreased speculative activity or a market reset
Could a drop in open interest really lead to a 600 price surge
Its possible but highly speculative A sharp drop can indicate that a period of high leverage and volatility has cleared out This can set the stage for a new strong price move if fresh buying pressure enters but a 600 surge would require massive new demand and a major catalyst
Is this a guaranteed buy signal
No While low open interest can reduce selling pressure from liquidations it is not a guaranteed signal Prices can stay low or fall further if overall market sentiment is negative or if theres no new positive news for XRP
What other factors should I watch besides open interest
Watch overall crypto market trends XRPspecific news trading volume and major supportresistance price levels Never rely on a single metric
Advanced Questions
How does declining open interest typically affect market structure
A significant decline often flushes out weak hands and overleveraged positions This reduces the risk of a cascade of forced liquidations and can lead to a healthier less volatile foundation for the next trend
Whats the difference between open interest and trading volume
Volume measures the total number of contracts traded in a period Open interest measures the total number of contracts that remain open Volume can be high while open interest stays flat or falls if traders are quickly opening and closing positions
Could this low open interest indicate capitulation
Yes it can be a sign of capitulation especially if the drop coincides with a sharp price decline on high volume This is when discouraged traders exit their positions en masse which is sometimes viewed as a contrarian bottoming signal