- XRP outperformed other major cryptocurrencies in the last week.
- Teucrium’s leveraged XRP ETF amassed $36 million from investors
- Retail-heavy ownership could weaken the price in the short term.
XRP’s price punched 30% higher this past week, fuelled by $160 million in net flows from crypto exchanges.
This spurred a surge for the Ripple-linked cryptocurrency.
But the surge appears short-lived as data from crypto analytics platform Coinglass shows fresh inflows pouring into crypto exchanges, which signals short-term profit-taking.
It could also mean a reversal for XRP, which is the cryptocurrency Ripple uses to facilitate cross-border payments.
A slide
Options traders are already looking for a slide. Open interest is mostly skewed towards the downside for XRP as puts with a strike price of $1.80 are drawing heavy action.
Options contracts allow traders to bet on the price of the underlying asset, and puts are bearish bets that pay off if the price of the asset falls.
In XRP’s case, options traders don’t expect the cryptocurrency to trade above $2 in April and May.
XRP is already down 2.4% on Monday, as its recent price rally appears to have stalled.
Meanwhile, other major cryptocurrencies are up in the last 24 hours, with Ethereum rallying 4.6% and Solana gaining 3%.
XRP and cryptocurrencies in general remain on edge as President Donald Trump’s trade war clouds the global economic outlook. But XRP is showing even more weakness amid retail anxiety.
Retail buyers upped their share of XRP’s market value to 47% in the last six months, according to analysts at Glassnode. That has led to a major concentration of XRP ownership in retail hands.
While the trend delivered a massive rally for XRP earlier in the year, it has flipped into a major concern for investors.
The rapid accumulation by retail investors may induce fragility in the short term for XRP as newer buyers with elevated cost bases cut their losses.
Child’s play
XRP is down 36% since Trump’s inauguration on January 20, more than double the average market decline for other major cryptocurrencies, including Bitcoin.
But the news isn’t all bad for XRP.
Last week, Teucrium, a Vermont-based investment firm, launched the first US-listed XRP exchange-traded fund. Teucrium’s leveraged ETF posted a five-day winning streak last week, with total flows topping $36 million.
While the fund’s performance is “child’s play” compared to Bitcoin ETFs, according to Bloomberg Intelligence analyst Eric Balchunas, it showed that there’s appetite for altcoin ETFs.
Also, Ethereum and Bitcoin ETFs performed poorly last week, with the investors removing more than $790 million in total from both investment vehicles, according to data from Farside Investors.
Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at osato@dlnews.com.
