As XRP price fell below a crucial psychological support level of $1 for the first time since November 2024 on August 11, its Funding Rates – a fee set by crypto exchanges to maintain balance between the perpetual contract price and the underlying asset price – spiked by more than 200% amid rising derivatives exposure.
XRP’s Funding Rate was 0.03059 at press time, up 211.23% over the last 24 hours, according to data from CryptoQuant.
This fee ballooned in tandem with rising XRP’s Open Interest (OI), the total unsettled futures in the derivatives market. At the time of publication, the token’s OI was at about $883.8 million, up over 7.6% during the past 24 hours.
XRP’s Funding Rates and OI had remained almost flat over the last few days, but experienced a notable increase on Tuesday. As such, crypto derivatives traders have turned more bullish on XRP with more long positions.
Furthermore, positive funding rates signal that traders are more bullish, as they are willing to pay the fee to short traders to maintain their long bets.
XRP price outlook amid bullish derivatives traders
XRP price has dropped over 8% over the past 30 days, trading at approximately $1.01 at the time of reporting. As the altcoin teased below $1 for the first time in 2026, more than $11.43 million in long trades were liquidated, out of the total $11.81 million rekt during the past 24 hours, according to metrics from CoinGlass.
With the token’s price retesting a multi-month support level, as Finbold reported, a bullish derivatives market alongside renewed demand in its spot market could trigger a potential reversal. However, if XRP’s price continues to fall in the coming days, a potential long squeeze – a situation where falling prices force long holders to sell, accelerating the decline – may occur.
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