XRP futures traders appear to be pulling back as open interest dropped, funding rates weakened, and exchange transaction activity fell significantly.
XRP failed to break above $1.40 on Wednesday despite early-week optimism about a potential resolution to the Iran conflict. At the same time, derivatives data suggest speculative activity in the market has been cooling.
Open interest in XRP derivatives has declined sharply across major trading platforms after a period of strong speculative activity that accompanied the asset’s rally toward its cycle peak in July 2025.
Signs of Cooling After Heavy Long Liquidations
New data tracking multi-exchange open interest shows that the total value of active futures contracts has dropped noticeably across nearly all major exchanges, which indicates a reduction in leveraged participation. Open interest represents the total number of futures contracts that remain active in the market, and a decline typically means that traders are closing positions or reducing exposure.
Despite the broader decline, Binance continues to hold the largest share of XRP derivatives activity, as open interest currently stands at approximately $222 million. Bybit follows with about $195 million in open interest. While these figures remain higher than the lowest levels recorded in 2024, they are significantly below the high readings observed during mid-2025 when XRP reached its cycle high and speculative trading activity intensified.
After examining liquidation data across exchanges, CryptoQuant found a clear dominance of long liquidations compared with short liquidations, both in frequency and total value. This pattern suggests that bullish traders have been disproportionately affected by recent market volatility.
The report also said that heavy long liquidations typically push funding rates lower, and often bring them back toward neutral levels or even into negative territory. Such conditions generally reflect weakening bullish sentiment and increased caution among derivatives traders.
Market Participation Slows
Meanwhile, activity involving XRP transfers to and from major cryptocurrency exchanges has dropped to its lowest level since the indicator was introduced. The data comes from the Multi Exchanges Daily Depositing/Withdrawing Transactions Delta, a metric that tracks the number of XRP deposit and withdrawal transactions across 15 major trading platforms.
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According to the analysis, the sharp decline in transaction activity comes after XRP’s price fell by more than 60% from the highs recorded last summer. The drop in deposits and withdrawals means that fewer users are currently interacting with exchanges, in what appears to be a notable slowdown in overall exchange-related activity for the cryptocurrency.
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