XRP Rallies to 7-Year High as Derivatives Surge, Market Sentiment Strong

XRP, the payment-focused cryptocurrency, has surged to its highest levels in seven years, driven by a combination of strong market sentiment and unprecedented activity in its derivatives market. This comes as the token makes a dramatic recovery, surpassing $3 for the first time since 2018, following a 50% rise in January.

The surge marks the continuation of a remarkable 240% rally from the previous quarter. XRP’s market capitalization has now climbed to $176.75 billion, reclaiming its position as the third-largest cryptocurrency, behind Bitcoin (BTC) and Ethereum (ETH). This uptrend has continued into the new year, with XRP gaining 30% in just the past week.

XRP’s current rally is its fastest in years, as indicated by the relative strength index (RSI), which has reached a 12-month high of 92. This is the strongest momentum the cryptocurrency has seen in over seven years. While an RSI above 70 traditionally suggests overbought conditions, analysts note that such readings can persist in bullish trends, making corrections less predictable.

In addition to strong price action, XRP’s derivatives market has also been on fire. Trading volumes have tripled to over $23 billion in the last 24 hours, validating the price movement. Furthermore, the total volume in XRP derivatives has more than doubled to $34 billion, signaling that institutional and retail traders are betting heavily on XRP’s continued upside.

XRP’s perpetual futures open interest has soared to a record high of 2.34 billion XRP, with funding rates remaining healthy at 13%. This is a marked contrast to the overheated conditions seen earlier in the month, suggesting a more stable and sustainable rally.

Ripple’s ongoing partnerships, the potential approval of an XRP spot ETF, and the rising popularity of its RLUSD stablecoin have all contributed to the strong market sentiment. Furthermore, Bitcoin’s continued strength, pushing past $100,000, has helped drive the broader crypto market’s risk-on behavior, lifting altcoins like XRP.

With no signs of the rally slowing down, XRP looks poised for even further gains as it continues to ride the wave of institutional adoption and growing market interest.