XRP Open Interest Falls to Lowest Level Since 2024: Market Reset Or Warning Signal?

XRP has entered a critical phase after losing the $1.80 level and sliding toward the $1.60 zone, where price is now attempting to find short-term support. The move comes amid broader weakness across the crypto market, but XRP’s structure shows an additional layer of stress that goes beyond spot price action. According to a recent report from CryptoQuant, the derivatives side of the XRP market is undergoing a sharp contraction in leverage, signaling a meaningful shift in trader behavior.

Data shows that open interest across all XRP derivatives platforms has fallen to roughly 902 million, marking its lowest level since 2024. This is a stark contrast to conditions seen during 2025, when open interest consistently hovered between 2.5 and 3.0 billion. The magnitude of this decline suggests that leverage is being actively unwound rather than merely rotating between exchanges, pointing to a broader risk-off adjustment.

Such contractions often reflect a market that is de-risking after extended volatility. With fewer leveraged positions in play, price movements tend to become slower but more deliberate, as speculative excess is flushed out. As XRP tests the $1.60 area, analysts are closely watching whether this leverage reset lays the groundwork for stabilization—or signals deeper downside still ahead.

Leverage Reset Signals a Potential Base-Building Phase

The report adds important color by breaking down where the leverage reduction is taking place. On Binance, open interest in XRP derivatives has fallen to around 458 million. While this figure remains above the levels observed last December, it still represents a sharp contraction from the highs seen earlier in the cycle.

Crucially, this decline on Binance mirrors what is happening across other major trading venues, reinforcing the view that the market is undergoing a broad deleveraging phase rather than a simple migration of positions between exchanges.

From a structural standpoint, this matters. When open interest compresses simultaneously across platforms, it typically reflects traders actively reducing risk and closing leveraged exposure. This kind of environment often precedes periods of price consolidation, as the market digests prior volatility and searches for a new equilibrium. In past cycles, these phases have frequently led to the formation of base structures, particularly when selling pressure fades and volatility compresses.

Looking ahead, analysts note that any recovery in open interest will be critical to monitor. A rebound in leverage that coincides with improving price momentum could serve as an early signal that a new trend is developing.

For now, however, the drop in open interest to its lowest level since 2024 points to a clear market cleanup. While this reset may appear quiet on the surface, it can provide a healthier foundation for future moves—provided risk management remains front and center in the next phase of XRP’s market evolution.

XRP Price Showing Weakness

XRP price action continues to reflect structural weakness as the asset trades decisively below its key moving averages and tests the $1.60 zone for support. The chart shows a clear transition from a prior uptrend into a sustained downtrend, marked by lower highs and lower lows since the October peak near the $3.50–$3.60 region. Momentum has steadily deteriorated, with each rebound failing below the declining short- and medium-term moving averages, signaling persistent seller control.

The loss of the $1.80 level is technically significant. This zone previously acted as a consolidation base and demand area, but the clean breakdown suggests that buyers have stepped aside rather than aggressively defending the price. XRP is now trading below the 50-day and 100-day moving averages, while the 200-day moving average above continues to slope downward, reinforcing a bearish medium-term structure.

Volume remains relatively muted compared to earlier distribution phases, which aligns with the derivatives data showing a contraction in leverage rather than panic-driven liquidation. This supports the view that the current move is more of a controlled unwind than a capitulation event.

As long as price holds the $1.55–$1.60 region, XRP may attempt to stabilize and form a base. However, a failure to hold this area would expose the market to a deeper retracement toward prior demand zones near $1.30–$1.40.

Featured image from ChatGPT, chart from TradingView.com