XRP has seen notable activity in the last 24 hours that signals distress for the altcoin. The asset’s open interest has suffered a huge decline in the crypto market. As per CoinGlass data, XRP plunged by 6.67% within this time frame.
Sharp decline in XRP open interest raises investor concerns
Notably, XRP recorded $4.78 billion in open interest as investors committed 2.03 billion XRP to the asset's futures contracts. Although this volume is significant, the over 6% drop suggests a massive loss of confidence by XRP investors.
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For context, open interest refers to the total number of active futures contracts that have not been settled. A notable drop in this metric signals the asset could be in distress.
This concern is reflected in the coin's current price outlook. As of this writing, XRP was changing hands at $2.33, representing a 3.50% decline in the last 24 hours. The coin has continued to experience volatility, testing the $2.30 support level.
This has dramatically impacted investors’ confidence in the crypto space. As a result of this price performance, XRP’s trading volume has plummeted by a massive 38.82% to $3.2 billion.
Some market participants consider this drop in volume to have occurred because investors were engaged in profit-taking. It is unclear if this trend will linger and push XRP into a bearish mode that could trigger a price slip.
Is legal setback responsible for setbacks?
This marks a major shift from XRP’s performance earlier in the week when it shot up by a staggering 140% as it decoupled from the rest of the crypto market. It is worth noting that while it hit this level, other notable assets like Bitcoin were in the red.
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Some market observers have cited the recent legal setback in the settlement between the Securities and Exchange Commission (SEC) and Ripple as a factor.
However, a Ripple executive has assured that the development has no negative implications and remains safe from a regulatory standpoint.
