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Despite the mid-to-long-term positive factor of institutional fund inflow, XRP is facing short-term volatility, hampered by reduced leverage in the derivatives market.
According to the cryptocurrency specialized media Bitcoinist on June 20 (local time), XRP is showing weakness amidst a broader sell-off in the cryptocurrency market, and while institutional demand for XRP-linked investment products continues, short-term derivatives pressure has increased.
Bitcoinist reported that the XRP/USDT chart is under downward pressure following a sell-off that affected major altcoins. CoinGlass open interest data also signaled that investors are reducing exposure and liquidating leveraged positions during price declines.
The key variable is the difference in sentiment between institutional demand and the derivatives market. XRP has seen increased institutional accessibility since the launch of spot-based products, with previous market reports suggesting cumulative inflows of approximately $1.44 billion. However, Bitcoinist pointed out that even if structural demand exists, derivatives selling could drive down prices if the broader market turns to risk aversion.
The trend of decreasing open interest alongside price declines is interpreted as crowded long positions being unwound through liquidations, stop-losses, and position closures. Leverage can distort price movements, so even if XRP has a mid-to-long-term narrative, short-term investors must endure daily volatility. Bitcoin (BTC) direction, macro risk appetite, exchange liquidity, and the funding market were also cited as variables influencing XRP prices.
Bitcoinist suggested price stability, recovery of moving average resistance, gradual re-accumulation of open interest, and sustained ETF inflows or linked product fund flows as signals for XRP bulls to watch. Currently, XRP still has the narrative of institutional accessibility, ETF demand, and its position within the major altcoin market, but the price trend needs to show a phase shift that supports this narrative.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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