The XRP price has broken a new all-time high, having risen above its previous major rally in 2017. This comes on the back of rising open interest in derivatives markets.

XRP’s price has surged to a multi-year high of $3.37, according to Coingecko data. The payments-focused cryptocurrency has recently exhibited remarkable growth over, climbing over 16% in the past day, 38% in the past week, and an astonishing 455% over the past quarter.

XRP’s rally has been fueled by several significant factors, with Bitget Research Chief Analyst Ryan Lee highlighting the primary drivers. Speaking to The Block, Lee pointed to potentially more favorable developments in Ripple’s legal battle with the SEC, which could be facilitated by the upcoming leadership change at the agency, as a key catalyst. He also noted the broader emergence of a more crypto-friendly political climate in the U.S.

The XRP derivatives market has also been experiencing unprecedented activity, with key metrics indicating a surge in trader interest and bullish sentiment. Over the past 24 hours, XRP futures open interest across all major crypto derivatives exchanges has risen by 22.66% to a record $7.7 billion, according to data from Coinglass. This marks the highest level of open interest since the analytics firm began tracking such data.

Open interest represents the total number of outstanding futures contracts that remain unsettled or open, and a sharp increase often signals heightened trader activity and anticipation of significant price movements. 

XRP futures open interest on major crypto derivatives exchanges has reached a record high. Image: Coinglass.

Complementing this trend, XRP perpetual futures open interest-weighted funding rate has shown a positive increase, highlighting market optimism towards the cryptocurrency. The positive funding rates for XRP perpetual futures—indicating the cost of holding leveraged positions—are hovering around 0.01% for the past 8-hour cycle. This elevated rate suggests a pronounced bullish sentiment, as traders are willing to pay a premium to maintain their long positions.

The transition in SEC leadership could mark a turning point in the agency’s enforcement approach. Current SEC Chair Gary Gensler is set to step down, and President-elect Trump has selected former SEC Commissioner Paul Atkins—a figure widely recognized as pro-crypto—to take the helm.

Lee also pointed to the potential for institutional finance adoption of Ripple's innovations. "The RippleNet payment network for financial institutions’ expanding adoption and strategic partnerships have also enhanced XRP's market appeal,” he added. “If regulatory uncertainties are resolved, the influx of institutional investors could further solidify XRP’s position in the crypto market.”

However, recent developments have highlighted ongoing legal challenges. On Wednesday, the U.S. Securities and Exchange Commission (SEC) filed an appeal against a 2023 district court ruling, arguing that the court erred in deciding that certain sales of XRP to retail investors did not violate securities laws. In its brief to the U.S. Court of Appeals for the Second Circuit, the SEC urged the court to “vacate” the district court’s judgment, among other requests.

"The district court reasoned that institutional investors reasonably expected profits from the efforts of others because Ripple represented that its efforts would increase the price of XRP," the SEC said. "But the district court erroneously found that retail investors did not have that same expectation because they purchased XRP through crypto asset trading platforms and thus did not know if the seller was Ripple, a Ripple affiliate, or someone else."

Despite this recent appeal, Lee remains optimistic about XRP’s prospects for 2025, particularly in payment solutions and international transfers. "Its strong foothold in banking and international transfers could secure a competitive edge," he said. "However, navigating market volatility and competition from emerging blockchain technologies will be critical for maintaining its momentum."

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

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