Author: Tom Mitchelhill, CoinTelegraph; Compiled by: Tong Deng, Jinse Finance
Analysts warn that Ripple's native XRP token may experience a "leverage-driven" rally as the asset's price soars to its highest level since 2021.
In an article to X on December 1, CryptoQuant analyst Maarten Regterschot pointed out that XRP's open interest (a metric for measuring open derivative positions) has surged significantly in the past 24 hours, warning that the sharp rise could lead to a rapid sell-off.
"Open interest has risen 37% - watch out for volatility. A similar event last time led to a 17% drop."
"Stay alert and manage risk accordingly."
Source: Maarten Regterschot
According to CoinGlass data, XRP's open interest has surged 30% in the past 24 hours, reaching $4 billion on major exchanges and trading platforms.
According to TradingView data, at the time of writing, XRP's trading price was $2.39, up 68% in the past month.
XRP rose nearly 70% last week. Source: TradingView
Since Donald Trump's victory in the November 6 election, XRP has been rising along with major cryptocurrencies including Bitcoin and Solana, but XRP's performance has started to outperform other major tokens.
On December 1, XRP's market capitalization surpassed Solana and later Tether, becoming the third largest cryptocurrency by total value.
XRP's exceptional value-for-money is due to an increasing number of key partnerships, new product development by Ripple Labs, the possibility of an XRP ETF, and unconfirmed rumors that Elon Musk will make a significant investment in XRP and Ripple.
Asset management firm 21Shares applied for an XRP ETF in November 2024, raising investor expectations that the U.S. Securities and Exchange Commission (SEC) (likely to be led by new leadership in January 2025) will approve the ETF application.
