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XRP lost $2.4B in open interest, signaling high volatility in the cryptocurrency market.
A drop below $3.00 could trigger a larger sell-off in XRP futures.
Whale activity and Ethereum’s strength continue to influence XRP price trends.
The cryptocurrency market is once again in the spotlight as XRP, the native token of the XRP Ledger, experiences a major shake-up in its derivatives market. Recently, XRP lost $2.4 billion in open interest in just a few days, sparking fear among traders and investors that a deeper price crash could be coming.
Open interest is an important measure in the futures market. It represents the total value of outstanding futures contracts that have not been settled. When open interest drops sharply, it often signals that traders are closing their positions, either to take profit or cut their losses. This can lead to high market volatility and sudden price movements.
In mid-July 2025, XRP price reached a peak of $3.66, marking a strong rally for the token. But shortly after that, the market turned sharply. Within a few days:
XRP futures open interest dropped from $11.2 billion to $8.8 billion, a loss of $2.4 billion.
XRP’s price fell by about 15%, reaching lows of around $3.09 to $3.10.
Around $325 million worth of leveraged positions were liquidated during this period.
This sudden drop in open interest shows that many traders exited the market quickly, either owing to stop losses being triggered or due to the fact that they feared further declines.
Open interest is often used as an indicator of market sentiment.
High and rising open interest suggests strong confidence and heavy trading activity.
Falling open interest usually means traders are leaving the market, and momentum is weakening.
The recent $2.4 billion decline in XRP’s open interest is significant because it happened after a strong price rally. This suggests that traders were heavily leveraged and started closing positions once the price began to correct.
Even after the drop, open interest is still 48% higher than a month ago, showing that speculation on XRP remains elevated. However, the sudden decline also highlights the risk of further price swings if market sentiment turns negative.
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After the price reached $3.66, XRP quickly dropped to around $3.10. This created a strong support zone between $3.10 and $3.20.
Support level: Around $3.00–$3.10
Resistance level: Between $3.20 and $3.50
Next major support: $2.80, followed by $2.50 if the price breaks below $3.00
Technical indicators such as the Relative Strength Index (RSI) moved to a neutral level around 48, which means XRP is neither overbought nor oversold. This could mean the market is trying to stabilize before making its next big move.
Several factors caused the decline in XRP’s open interest and price:
A Ripple co-founder moved about $175 million worth of XRP to multiple wallets, and around $140 million eventually reached exchanges. Large transfers like these often trigger fear in the market because they can signal selling pressure.
After XRP’s sharp rally to $3.66, many traders and investors locked in their profits. This selling activity contributed to the decline in both price and open interest.
While XRP was correcting, other cryptocurrencies like Ethereum saw price gains. Market participants often rotate their capital to coins with better short-term potential, which can hurt XRP’s momentum.
More XRP was being sent to exchanges than withdrawn, which usually indicates that holders are preparing to sell their tokens rather than hold them.
The market is currently sending mixed signals about XRP’s next move.
If XRP falls below $3.00, it could trigger another wave of selling and liquidations.
Automated margin calls in the futures market could push the price down to $2.80 or even $2.50.
On-chain activity on the XRP Ledger remains low, which limits the fundamental support for a price rally.
The recent sell-off may have already flushed out over-leveraged positions.
Whales reportedly bought around 60 million XRP during the dip, suggesting that big players believe in the $3.10 support zone.
If XRP moves back above $3.20 and breaks $3.50, a short squeeze could occur, sending the price higher quickly.
The long-running legal battle between Ripple and the US Securities and Exchange Commission (SEC) remains a key market driver. If the court rejects any pending appeals by mid-August 2025, it could boost XRP’s market confidence and attract institutional investors.
Although there is no spot XRP ETF yet, any new announcements around institutional adoption or custody partnerships can strengthen market sentiment. Ripple’s collaboration with major financial institutions could play a key role here.
For XRP to maintain long-term price strength, its blockchain ecosystem needs more real-world usage. This includes tokenized assets, decentralized finance (DeFi), and cross-border payment solutions.
Also Read - XRP vs. Dogecoin: Which Crypto Will Grow Faster in 2025?
XRP’s recent $2.4 billion drop in open interest has shaken market confidence. The token’s price correction from $3.66 to around $3.10 shows that speculative trading remains a double-edged sword.
A fall below $3.00 could lead to a deeper crash toward $2.80 or $2.50.
A rebound above $3.20–$3.50 could trigger a short squeeze and restore bullish momentum.
For now, XRP is in a delicate position. Traders and investors are watching support levels closely, along with developments in the Ripple-SEC case and institutional activity. The coming weeks will determine whether this is just a healthy correction or the start of a larger downturn.
