Ripple’s XRP saw a modest 1% decline on Tuesday, reflecting broader market turbulence. Yet, despite growing bearish signals in the futures market, long-term XRP holders remain in a strong profit position—highlighting a fascinating divergence between short-term sentiment and long-term confidence. On-chain metrics and derivatives data paint a complex picture: while traders lean bearish, structural fundamentals and investor behavior suggest underlying resilience.
XRP’s Profitable Holders Cushion Price Volatility
Despite a challenging environment for cryptocurrencies following the early February market correction, XRP has demonstrated surprising price stability. While Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) all posted weekly losses, XRP managed a 3% gain—outperforming many of its peers.
One key factor behind this resilience? High unrealized profit margins among long-term holders. According to analytics platform Santiment, the average XRP long-term holder is sitting on unrealized gains of approximately 233%. This deep profitability reduces selling pressure, even amid negative sentiment in derivative markets.
When investors are significantly in the green, they're less likely to panic-sell during downturns. This dynamic has helped insulate XRP from sharper declines seen across the broader crypto market.
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Declining Open Interest Reflects Trader Caution
Data from Coinglass shows that XRP’s futures open interest (OI)—the total value of outstanding derivative contracts—dropped by 33% between February 1 and March 18. This decline suggests that traders are pulling back, signaling a risk-off stance in the short term.
A falling OI typically indicates that traders are closing positions, often due to uncertainty or anticipation of volatility. In XRP’s case, this pullback aligns with a broader consolidation phase across crypto markets.
Additionally, funding rates for XRP perpetual futures have remained mostly negative in recent weeks. Negative funding rates mean that short-position holders are being paid by longs—indicating that bearish bets currently dominate the market.
However, this bearish positioning hasn’t translated into steep price drops, thanks largely to the confidence of long-term investors who are not reacting to short-term noise.
On-Chain Activity Shows Maturity in XRP’s Holder Base
Another sign of strength lies in XRP’s dormant circulation trends. Santiment data reveals that much of the recent movement involves tokens that are one year old or younger. This suggests that older, more entrenched holders are not dumping their holdings—further reducing sell-side pressure.
The lack of movement from older wallets implies trust in Ripple’s long-term vision and confidence in potential catalysts ahead. Among the most anticipated? The final resolution of the SEC vs. Ripple lawsuit.
Recent reports indicate both parties are nearing a settlement, which could serve as a major bullish trigger for XRP. A favorable legal outcome would remove years of regulatory overhang and potentially reclassify XRP as non-security in the U.S., opening doors for wider institutional adoption.
Technical Outlook: Can XRP Flip to Bullish?
From a technical perspective, XRP is at a critical juncture. After briefly breaking above a long-standing descending channel, the price is now retesting the upper boundary for the third consecutive day. This level has transformed from resistance into potential support—a classic sign of possible trend reversal.
If XRP successfully holds this level, the next major resistance lies at $2.72. A decisive close above this point could propel the asset toward its seven-year high, reigniting bullish momentum across the board.
Key technical indicators are also approaching inflection points:
- The Relative Strength Index (RSI) is nearing neutral territory (50), suggesting momentum could swing either way.
- The Stochastic Oscillator is coiling near its midpoint, indicating consolidation before a potential breakout.
- The MACD is showing signs of convergence, with a bullish crossover possible if buying pressure increases.
A daily candlestick close above the channel’s upper boundary would confirm a bullish breakout. Conversely, failure to hold support near the $2.00 psychological level** could invalidate the bullish thesis and open the door to a drop toward **$1.35.
In the past 24 hours alone, XRP saw **$7.4 million in futures liquidations**, with $5.15 million coming from long positions and $2.25 million from shorts. This imbalance suggests that leveraged bulls were caught off guard by short-term weakness—but if support holds, it could set up a strong squeeze to the upside.
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Frequently Asked Questions (FAQs)
Q: What is XRP used for?
A: XRP is the native cryptocurrency of the XRPLedger, a decentralized blockchain designed for fast, low-cost cross-border payments. It enables financial institutions to transfer value globally in seconds, reducing reliance on traditional intermediaries like correspondent banks.
Q: Is XRP a security?
A: This has been the central question in the SEC vs. Ripple lawsuit. While the SEC initially claimed XRP was an unregistered security, U.S. District Judge Analisa Torres ruled in July 2023 that XRP is not a security when sold to retail investors. The case continues regarding institutional sales, but the ruling was a major win for Ripple and the broader crypto industry.
Q: Who owns Ripple and created XRP?
A: Ripple Labs Inc. operates RippleNet and promotes the use of XRP. The token was co-created by Jed McCaleb, Arthur Britto, and David Schwartz in 2012. McCaleb later co-founded Stellar (XLM), but remains a notable figure in blockchain payments innovation.
Q: How does XRPLedger differ from other blockchains?
A: Unlike proof-of-work or proof-of-stake chains, XRPLedger uses a consensus protocol that validates transactions in seconds with minimal energy use. It also features a built-in anti-spam mechanism requiring small transaction fees (destroyed after use), which helps prevent DDoS attacks.
Q: Can XRP reach $10?
A: While speculative, such a price would require massive adoption by banks and payment providers via RippleNet, regulatory clarity globally, and sustained demand for on-chain liquidity solutions. Market conditions, macro trends, and technological upgrades would all play a role.
Q: Where can I trade XRP safely?
A: Major compliant exchanges continue to list XRP globally despite past regulatory scrutiny. Trading platforms with strong security and liquidity are essential for managing risk in volatile markets.
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Final Thoughts: Contradictory Signals Point to a Make-or-Break Phase
XRP stands at a crossroads. Bearish sentiment dominates the futures market, reflected in declining open interest and negative funding rates. Yet long-term holders remain highly profitable and largely unmoved by short-term swings.
The resolution of the SEC case looms as a potential catalyst that could shift sentiment decisively. Technically, holding above the descending channel’s upper boundary is crucial—if sustained, it could spark a new leg upward toward $2.72 and beyond.
For investors, the message is clear: while derivatives suggest caution, fundamentals and holder behavior reveal enduring strength. In crypto, where perception often drives price, XRP’s story may be far from over.
Core Keywords: XRP, Ripple, futures market, long-term holders, open interest, funding rates, SEC lawsuit, technical analysis