Is XRP Targeting an ATH? Price Hits Six-Month High as Investors Bet on Favorable Crypto Regulations and RWA Tokenization

XRP, the native cryptocurrency of the XRPL blockchain, has started a fresh rally above $3.00, experiencing a 10% increase over the past 24 hours. The latest surge has resulted in the coin hitting a six-month high on Wednesday as notional open interest (OI) surged to record levels.

The third-largest cryptocurrency by market capitalization has seen its price climb as high as $3.31 this year, while soaring over 420% in the past 12 months. Investors are optimistic about XRP’s institutional-grade usefulness and believe that a more favorable regulatory environment, especially in the United States, could support its growth.

Open Interest for XRP Futures Hit New Record at $8.8 Billion as Traders Expect Further Gains

The notional OI for XRP perpetual futures, which refers to the total number of futures contracts that remain active in the market and are yet to be settled by traders, surpassed $8.8 billion on Wednesday. This is equivalent to around 2.89 billion XRP at current rates. The latest OI figure has toppled the previous all-time high of $8.3 billion, recorded days before President Donald Trump began his second term at the White House.

Bitget and Binance saw the majority of the notional open interest among centralized crypto exchanges, controlling $1.94 billion and $1.48 billion worth of leveraged XRP positions, respectively.

Meanwhile, XRP’s funding rate across most trading platforms remained positive and is trending upwards. This means traders maintaining long positions were willing to pay traders holding short positions more in exchange for leveraged exposure, which is a classic signal of a bullish market.

Speaking to crypto media outlet Decrypt, Greg Magadini, director of derivatives at digital asset and market intelligence firm Amberdata, said that when people are trying to FOMO (Fear of Missing Out) and believe that the price is going to go up, they are more willing to pay a higher interest rate to leverage long.

Carlos Guzman, an analyst at crypto market maker GSR, noticed that individual traders are reaching for familiar cryptocurrencies, especially ones that were popular during the pandemic-era crypto boom, with XRP chief among them. He pointed to the wider availability and enhanced retail awareness of these assets as key factors.

Analysts Suggest Institutional RWA Tokenization Efforts Could Benefit XRP

Matt Kreiser, an analyst at crypto analytics platform Messari, said that XRP also stands to benefit from the ongoing tokenization trend, which financial institutions are seemingly more interested in as they explore ways to represent real-world assets, such as stocks and bonds, using blockchain-issued tokens.

He suggested that XRP’s native blockchain, the XRP Ledger (XRPL), has compliance features at the chain level that could theoretically make it the first choice for institutions to tokenize and manage their products on-chain. Kresier also said that smart contract support and the introduction of an Ethereum-compatible sidechain on XRPL could increase the network’s adoption.

Analysts at Standard Chartered Bank wrote in an April note that XRP is similar to most stablecoins, as it is designed primarily for cross-border and cross-currency payments, but is “uniquely positioned” to cater to the growing institutional use case for digital assets.

Ripple Labs, the fintech behind XRPL and XRP, faced serious regulatory challenges from the US Securities and Exchange Commission (SEC) under the agency’s previous leadership, even facing an existential crisis. The securities watchdog sued the company in December 2020 for violating securities laws over the secondary sales of XRP. In the past, the SEC classified crypto tokens as security assets, while industry players argued that they were commodities.

However, with the Trump administration adopting a crypto-friendly stance, the current leadership at the SEC has updated its regulatory guidance to view blockchain-issued tokens as a commodity rather than a security. The long-standing legal battle is finally coming to an end, as both Ripple Labs and the SEC have agreed to a settlement.

With the regulatory headwinds no longer existing, Ripple Labs is free to conduct business as normal.

Also Read: The Safest Cryptocurrency Wallets

Ripple Labs Appoints BNY Mellon as Custodian for RLUSD Stablecoin’s Assets

Last week, the company announced that it has chosen Bank of New York Mellon (BNY) as the primary custodian for the assets backing its RLUSD stablecoin.

In a press statement, the bank said RLUSD is unlike most consumer-facing dollar-pegged stablecoins, describing it as “purpose-built” for enterprise utility with institutional needs in mind. Under the arrangement, BNY will provide banking services to power Ripple’s stablecoin, while continuing to develop integrated solutions. The bank, which manages $43 billion in assets, is also the primary custodian for Circle’s USDC stablecoin.

Garlinghouse said on CNBC’s Squawk Box that Ripple’s partnership with BNY Mellon should be seen as a positive development for the crypto industry, as it reflects institutions’ newfound willingness to work with stablecoin issuers, calling it a “way to continue to build trust” in the system.

The potential passage of the GENIUS Act stablecoin regulation in the US will be beneficial to Ripple and its RLUSD.

US Spot XRP ETFs Given 90% Chance of Being Approved in 2025

Another positive development for XRP would be the approval of spot XRP exchange-traded funds (ETFs). Last month, Bloomberg analysts James Seyffart and Eric Balchunas raised their odds for crypto ETFs tied to multiple altcoins, including XRP, Dogecoin (DOGE), and Cardano (ADA), in the US to an overwhelming 90%.

Their optimism is based on increasing back-and-forth communication between ETF issuers and the SEC staff. There has been a notable surge in technical filings, such as 19b-4 acknowledgements and S-1 amendment requests, for these products, which are critical steps before a final approval from the regulator. 

Grayscale, Bitwise, Canary Capital, 21Shares, WisdomTree, CoinShares, and Franklin Templeton are the issuers hoping to list and trade spot XRP ETFs in the US. The funds aiming to track the spot price performance of XRP could be launched by the end of the year, according to Standard Chartered analysts.

XRP Price has Moved Above $3.20, Could an ATH be Next?

Meanwhile, XRP has begun a fresh move to climb above the $2.95 resistance level. Bulls remain in control of the market as it crossed the $3.00 barrier to test the $3.10 resistance zone before consolidating briefly at $3.05. The next hurdle for bulls is near the $3.20 zone, which it has currently cleared, and is only 15% away from its ATH of $3.84, recorded over eight years ago.

If there is a downside break and XRP closes below the $2.88 level, then prices might continue to decline toward the $2.84 support. The next major support level for XRP sits near the $2.75 zone.

At the time of writing, XRP is trading at $3.25, up 10.19% in the last 24 hours.