thecryptobasic.com
$XRP has been under steady selling pressure, but data suggests its futures Open Interest metric could spot the next big move.
With $XRP now trading at $1.35 and sitting 28% down year-to-date, a well-known $XRP community commentator says futures Open Interest could act as an “extremely great indicator” for predicting where price could head next, citing historical data.
Key Points
- $XRP is down 28% year-to-date, with the price at $1.35 and Open Interest (OI) reduced to $2.29 billion amid the current downtrend.
- Historical data suggest the $XRP price and Open Interest have always moved in lockstep.
- After Donald Trump’s November 2024 victory, $XRP climbed from $0.5 to $3.4 by January 2025 while OI hit a then-record $7.76 billion.
- In June to July 2025, $XRP rose from $2.19 to $3.6 as Open Interest reached a new all-time high of $10.94 billion.
- Rising prices and rising OI often feed into each other, but OI works best as a trend confirmation tool, not a standalone predictor.
Historical Data Confirms Relationship Between $XRP Price and OI
Chad Steingraber, a community commentator, highlighted this trend. Notably, CryptoQuant data confirms the close relationship between OI and price, as $XRP’s three last major price surges since 2021 have occurred alongside a rise in OI.
The first major surge happened between March 2021 and April 2021. Within this period, $XRP jumped from $0.46 to $1.96. At the same time, Open Interest expanded from around $500 million to $1.95 billion.
After the rally faded in the months that followed, both price and Open Interest pulled back together. Even the smaller rallies that came later still showed the same connection, though on a milder scale.
The second major move followed the November 2024 election win of Donald Trump. $XRP rose from $0.5 in early November 2024 to $3.4 by January 2025. During that same period, OI surged from about $640 million to $7.76 billion. When the rally slowed and the price fell, Open Interest dropped as well.
The third big rally came in June 2025, when $XRP climbed from $2.19 to $3.6 by July 2025. Notably, Open Interest jumped from $3.68 billion to $10.94 billion, marking another record high. Now, with $XRP back in a steep downtrend, Open Interest has also fallen to $2.29 billion.
Why $XRP Price and Open Interest Often Move Together
While Steingraber encourages investors to watch for Open Interest spikes as a signal of recovery, the relationship between price and Open Interest is not always simple. Notably, the two often move together because they feed off each other.
When the price starts rising, traders rush in to open long positions. Every new long position must match with a short contract, which increases total Open Interest.
This usually shows new money entering the market and strengthening the trend. At the same time, heavy leveraged trading can add buying pressure. Essentially, more contracts mean more liquidity and more room for volatility, which can, in turn, push prices higher.
Other Hidden Factors
Meanwhile, there is also a technical detail that many traders overlook. Specifically, exchanges often report Open Interest in dollar terms, not by the number of contracts. So when $XRP’s price rises, the dollar value of existing contracts rises too, even if traders do not add new positions.
This means reported Open Interest can increase automatically when price climbs, and this creates the impression of new activity even when the number of contracts stays the same.
Another subtle factor involves market psychology. Notably, when traders see both price and Open Interest rising together, they read it as a strong trend. This belief pulls in trend followers, which then creates higher demand to feed the uptrend and keep the cycle going.
Traders mainly use OI to confirm trends, not to predict direction on its own. When price rises, and Open Interest rises steadily, it usually indicates healthy participation and fresh capital. But if Open Interest shoots up too quickly during a rally, the market can become crowded with leveraged longs, raising the risk of sharp liquidations.