Leverage Leaves XRP Market As Traders Shift Toward Caution: What Comes Next?

XRP continues to struggle to reclaim higher price levels as persistent selling pressure weighs on the broader crypto market. Recent price action suggests a cautious environment, with traders showing reduced appetite for aggressive positioning amid ongoing volatility and uncertain macro conditions. While XRP has avoided a full breakdown, the inability to sustain upward momentum reflects a market still searching for clear directional conviction.

A recent CryptoQuant report provides additional insight into this shift by examining changes in XRP futures open interest over the past 30 days, measured in XRP-denominated units. The data show predominantly negative readings across major exchanges, indicating a broad phase of deleveraging rather than fresh speculative positioning. In practical terms, traders appear to be closing positions and reducing risk exposure instead of building leveraged bets on a strong directional move.

This contraction in open interest typically accompanies transitional market phases, where uncertainty encourages capital preservation over speculation. It can precede either renewed accumulation or further corrective pressure, depending on broader liquidity conditions and investor sentiment.

For XRP, the current environment suggests a cooling derivatives market and heightened caution among participants, leaving price action sensitive to shifts in demand, macro developments, and overall risk appetite in the digital asset space.

XRP Derivatives Market Shows Broad Deleveraging Across Major Exchanges

The CryptoQuant report provides a detailed breakdown of recent changes in futures open interest, highlighting a broad contraction across leading derivatives platforms. Over the past 30 days, Binance recorded an estimated decline of about 1.6 billion XRP in open interest, while Bybit saw a larger reduction of about 1.8 billion XRP.

Kraken also posted a substantial drop, approaching 1.5 billion XRP. Meanwhile, OKX registered a more moderate decline of roughly 446 million XRP, and BitMEX showed a comparatively small decrease of 36 million XRP.

These figures indicate that most position unwinding has occurred on the largest and most liquid exchanges, meaning their activity carries disproportionate influence over overall market structure and short-term sentiment. When deleveraging is concentrated in high-liquidity venues, price stability often becomes more sensitive to shifts in spot demand and macro conditions.

From a behavioral standpoint, declining open interest typically reflects a preference for risk reduction rather than aggressive directional speculation. This pattern is frequently observed during transitional market phases, either preceding local bottom formation or before a new trend begins to emerge. Instead of building leveraged exposure, traders appear to be prioritizing capital preservation, contributing to a calmer derivatives environment with reduced reliance on leverage and lower speculative intensity.

XRP Tests Key Support As Downtrend Structure Persists

XRP’s price structure remains under pressure on the higher-timeframe chart, with the asset recently dropping toward the $1.30–$1.40 zone after failing to sustain recoveries above former support levels. The chart shows a clear sequence of lower highs since the mid-cycle peak, indicating weakening bullish momentum and a gradual shift toward a more defensive market structure.

Technically, the price is trading below major moving averages, which now act as dynamic resistance rather than support. This positioning typically reflects sustained bearish control, especially when accompanied by declining upside follow-through during relief rallies. The latest decline also coincides with increased trading activity, suggesting distribution or leveraged position unwinding rather than organic accumulation.

From a structural perspective, the current price zone aligns with a historical liquidity area that previously supported consolidation. Holding this range could allow XRP to stabilize and potentially transition into sideways price action. However, a decisive breakdown below this level would increase the probability of deeper retracement toward earlier cycle support zones.

XRP remains sensitive to broader market sentiment, derivatives positioning, and macro liquidity trends. A sustained recovery above key moving averages would be required to signal renewed bullish momentum and restore confidence among market participants.

Featured image from ChatGPT, chart from TradingView.com