XRP’s 10% swoon has a silver lining — long positions on ‘perps’ are exploding

The price of XRP may have dropped 10% in the last week, but some traders aren’t pressing the panic button.

Long positions on XRP perpetuals, or perps ― futures contracts without expiration dates ― have exploded in the last week. The upshot: a snapback rally is not only possible, but very likely imminent, say analysts.

Data from Coinglass shows three times as many traders going long on XRP perps as have entered into short bets.

That’s the biggest margin between longs and shorts since April 7, right before XRP leapt almost 40% to $2.33 three weeks later.

Traders who piled into long XRP bets since April 7 made huge profits. Take, for instance, this whale who took out a $140,000 position on XRP when the price was $1.85 and is now sitting on a 250% profit even with the current price decline.

XRP, which is designed to be used by Ripple to facilitate cross-border payments onchain, traded for $2.10 on Tuesday as the three-week price climb faltered.

Still, the massively optimistic skew for XRP perps is significant when compared to other major cryptocurrencies, including Bitcoin, Ethereum, and Solana.

Bullish bias

The latter two show fairly equal distribution of longs and shorts, while Bitcoin perp traders are mostly bearish about the asset’s price.

Apart from perps, options data also show a bullish bias among XRP traders. That hasn’t always been the case this year, as options traders previously positioned for XRP being unable to stay above $2 in the first half of the year. But data from crypto derivatives exchange Deribit shows traders have flipped bullish and have piled into calls that XRP stays above $2.20 in the near term.

However, the bullish sentiment is not universal.

Signals from the crypto crystal ball Polymarket show bettors aren’t optimistic about XRP’s price prospects in May.

One bet on the prediction market gives XRP a 59% it will trade below $2.19 at the end of the month.

Another bet, which more broadly tracks XRP price predictions for this month, also leans heavily to the downside. The most popular bet for that market gives XRP an 82% chance of dropping as low as $2, while an equally popular bet is predicting an even bigger drop to $1.90 in May.

Polymarket’s XRP prediction data for May is a sharp reversal from the previous month. Crypto bettors wagered that XRP would hit $2.40 in April, but that outcome did not materialise.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at osato@dlnews.com.