- XRP rebounds sharply as derivatives market shows signs of caution.
- Over $500 million XRP transfer raises questions among crypto analysts.
- Traders remain uncertain despite XRP’s strong price recovery momentum.
XRP made a strong comeback after spending several days in the red, posting a 5.72 percent rise in the past 24 hours. According to CoinGlass, while the asset’s price moved upward, its open interest in derivatives fell by 5.26 percent to about $3.50 billion. This opposing trend signals that traders may still be cautious despite the renewed buying pressure.
The recent price movement follows a week of consolidation, during which XRP repeatedly tested the $1 level. The current surge places it among the day’s top gainers, showing renewed interest in the token. However, the drop in open interest indicates that many participants in the derivatives market have yet to return with confidence.
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Open interest measures the total value of active futures and perpetual contracts. Hence, a decline in this metric while the price climbs often reflects reduced speculative activity or traders closing out previous positions.
Moreover, the market appears to be recovering from the heavy losses witnessed during the early October crash. The rally could be linked to fresh optimism among retail investors, while institutional traders remain hesitant.
Historically, XRP’s futures activity has risen during strong market momentum, but recent figures suggest that leveraged exposure is still limited. Consequently, this rebound may represent a short-term correction rather than the beginning of a broader rally.
Derivatives Activity Reflects Market Caution
Data indicates that XRP open interest previously surged above $10 billion during major rallies, signaling stronger institutional participation. However, current readings suggest a slowdown as traders focus on managing risk instead of increasing exposure.
The combination of higher spot prices and declining futures engagement shows that investors are not yet convinced of lasting upside potential.
Hence, the ongoing recovery could be driven by spot buying and short covering rather than new speculative demand. For a sustainable rally, derivatives participation would need to rise alongside price growth, reflecting stronger conviction among market participants.
Mystery $500 Million XRP Transfer Sparks Speculation
According toVet, an XRP dUNL validator, revealed that over $500 million worth of XRP was recently moved by a Ripple-linked account to a newly activated wallet on October 17, as shown by XRPScan.
Vet emphasized that the account was not escrowed and lacked multisig protection, raising concerns over the transfer’s purpose. The large movement has stirred speculation within the XRP community, with some observers linking it to Ripple’s broader market strategy.
While XRP’s price rebound has encouraged optimism, the simultaneous drop in open interest and the mysterious transfer point to mixed signals.
