XRP bulls bet big as spot demand surges in Q3

XRP traders are piling into bullish positions as spot market demand accelerates, pushing the token to the center of Q3 altcoin projections.

XRP rose 4.2% to $1.13 as spot buying volume surged on major exchanges, with traders positioning for third-quarter gains.

"The combination of shrinking exchange supply and rising spot demand creates a setup we haven't seen since late 2024," said a CryptoQuant analyst tracking the Binance scarcity index.

Binance XRP reserves dropped 20% since November to about 2.6 billion tokens, while the Binance Scarcity Index climbed to 0.77, the highest in more than two years. XRP trading volume on Upbit surpassed Bitcoin's in the past 24 hours, with 113.18 million XRP changing hands, according to CoinGecko data. The token's monthly relative strength index recently reached its most oversold reading on record, a setup that has historically preceded trend reversals for the asset.

The $1.20 resistance level now represents the next test. A break above that could open the path toward $1.35 to $1.40, while a drop below $1.00 would invalidate the recovery structure.

Derivatives data shows the move has a short-covering component. XRP's open interest-weighted funding rate turned negative in late June as the price approached $1, with shorts paying to maintain positions. That crowding set the stage for a squeeze. Funding has turned mildly positive since early July, suggesting a positioning reset without tipping into euphoria, according to Coinglass data.

On the fundamental side, the XRP Ledger has seen tokenized real-world assets surge to $4 billion from $150 million within a year, according to a report by Coin Bureau. The growth positions XRP among the top four global tokenization networks alongside Ethereum and BNB Chain, with institutional inflows from spot XRP ETFs and stablecoin liquidity totaling more than $1.2 billion.

The token's supply dynamics add another layer. The drawdown of roughly 650 million XRP from Binance since November reflects coins moving into self-custody or cold storage, reducing the pool available for immediate sale. Historically, such supply contractions have preceded sustained price appreciation when accompanied by rising demand.

This article is for informational purposes only and does not constitute investment advice.