XRP, the cryptocurrency associated with Ripple, experienced a remarkable 100% surge in price following the landmark ruling in the XRP securities case. Judge Analisa Torres of the United States District Court for the Southern District of New York ruled that XRP sales to retail investors do not classify the token as a security in the SEC’s case against Ripple. Despite this positive development, buyers are currently struggling to maintain these gains.
The surge in price coincided with a surge in open interest volume for XRP futures contracts. CoinGlass data showed that the total value of open bets for XRP reached $1.19 billion on July 20, the highest point since November 2021. Additionally, XRP’s spot trading volumes surpassed those of Bitcoin and Ethereum, demonstrating increased trading interest in XRP.
However, while trading interest may be booming, the network’s growth has not experienced a similar increase. The number of transactions on the XRP Ledger has remained consistent for over a year, indicating a lack of new participants actively using the network. The XRP Ledger, which is a blockchain-based distributed ledger technology created by Ripple Labs, relies on XRP as a payment token and for securing the blockchain.
In an effort to promote XRP Ledger adoption, Ripple has ramped up its efforts, including participating in a $54 million investment in a metaverse project called Futureverse. Ripple also aims to reestablish its ties with banks to facilitate low-cost global payments, which could potentially drive network growth and serve as positive catalysts for the market.
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From a technical analysis perspective, the XRP/USD pair is facing resistance from a long-term bearish trendline that dates back to its peak in 2018. A weekly close above this level would likely strengthen investor sentiment and signal the end of the bearish trend. If buyers fail to maintain the bullish momentum, the price may revisit support around $0.54 before making another upward move.
Similarly, the XRP/BTC pair is encountering resistance at a long-term level that has held since 2019. Failure to establish support above this level could result in a return to support around 0.00001555 BTC. A bullish scenario would involve finding support at the 50-period moving average or the 200-period moving average.
Considering the surge in futures open interest for XRP, the cryptocurrency is expected to exhibit significant volatility in the near future. The funding rate for perpetual swaps, which indicates the demand for long or short positions, has also trended positively since the court ruling. This suggests that most traders have added long positions, potentially leading to a correction to liquidate overleveraged buyers.
Despite short-term uncertainties, the positive regulatory development, technical progress, and the popularity of XRP among retail users could signal the end of its long-term negative trend. It is anticipated that positive catalysts related to XRP’s mainstream adoption will emerge in the coming weeks.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and exercise caution when making financial decisions. The views expressed in this article belong solely to the author and do not necessarily reflect the opinions of Cointelegraph.
